Subject: DJ: Australia, Timor Set To Resume Talks In March - Source

Australia, Timor Set To Resume Talks In March - Source

Wednesday February 2, 11:58 PM EST

CANBERRA -(Dow Jones)- East Timor is poised to formally accept Australia's invitation to resume negotiations on a permanent maritime boundary.

Talks are expected to be held in Canberra next month, forming part of a previously agreed timetable of six-monthly meetings in a bid to resolve ownership of vast oil and gas reserves in the Timor Sea, a person familiar with the situation told Dow Jones Newswires Thursday.

Discussions between Canberra and Dili broke down in October, prompting Woodside Petroleum Ltd. (WPL.AU) to shelve its US$5 billion Sunrise liquefied natural gas project after the parties failed to meet an end-of-year deadline.

Woodside had warned it needed fiscal certainty on the project by the end of 2004 to capture a 2010 marketing "window" for LNG exports.

The company recently restated it won't be spending any more money to advance Sunrise and has reassigned staff to other projects.

Woodside owns 33.4% of Sunrise, regarded as the richest prize in the Timor Sea. Its partners are ConocoPhillips (COP) with 30%, Royal Dutch/Shell Group ( RD) with 26.6% and Japan's Osaka Gas Co. (9532.TO) with 10%.

East Timor is fighting for a maritime boundary in the middle of the 600 kilometers of sea separating the two countries.

Australia, instead, argues the boundary should be the edge of the continental shelf, which in some places is just 80 kilometers from East Timor's coastline. That border puts the bulk of natural resources in the Timor Sea under Australia's control.

-By Veronica Brooks, Dow Jones Newswires;

61-2-6208-0901; veronica.brooks@dowjones.com

-Edited by Paul Godby

Dow Jones Newswires


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