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East Timor to soon ratify Sunrise oil and gas treaty

East Timor's premier says Dili will consider ratifying revenue treaty next month

The Associated Press

Published: October 12, 2006

CANBERRA, Australia East Timor's parliament will next month consider ratifying a revenue sharing treaty with Australia covering Timor Sea energy resources that would remove one of the stumbling blocks to the development of a major oil and gas project, East Timor's prime minister said Thursday.

Under an accord signed in January, Australia and East Timor will equally share revenue from the seabed Greater Sunrise oil and gas field. Australia plans to ratify the deal after it has been endorsed by East Timor's parliament.

"I have scheduled the treaty for discussion in the Cabinet, maybe next week or the week after, and definitely then it will be brought to the parliament in sometime in November for ratification," East Timor's Prime Minister Jose Ramos-Horta told reporters after meeting his Australian counterpart John Howard.

Ramos-Horta has previously said he didn't anticipate any difficulty in getting the parliament to ratify the treaty.

Australian energy company Woodside Petroleum Ltd. owns and operates 33.4 percent of Sunrise, located 150 kilometers 150 (93 miles) south of East Timor. Its partners are ConocoPhillips with 30 percent, Royal Dutch Shell PLC with 26.6 percent and Japan's Osaka Gas Co. with 10 percent.

Greater Sunrise ­ the largest known petroleum resource in the Timor Sea ­ includes the Sunrise and Troubadour fields, which together hold about 8 trillion cubic feet of gas and about 300 million barrels of oil and may be worth up to US$40 billion (€32 billion).

The Sunrise partners are yet to decide where the gas will be processed, with Woodside favoring the Australian port city of Darwin and the East Timor government pushing for it to be processed in its country.

Australia and East Timor also signed a security agreement covering the Timor Sea oil and gas fields on Thursday.

The security pact will allow each country to conduct surveillance operations and to respond ­ separately or cooperatively ­ to any threats to offshore oil platforms and facilities in the area.

-- Market Watch/Dow Jones

East Timor to soon ratify Sunrise oil and gas treaty

By Barbara Adam

Last Update: 5:35 AM ET Oct 12, 2006

CANBERRA (MarketWatch) -- East Timor's parliament is expected to ratify a revenue sharing treaty covering Timor Sea oil and gas next month, removing one of the stumbling blocks to the development of the Greater Sunrise oil and gas project.

East Timor Prime Minister Jose Ramos-Horta said Thursday he expected his cabinet to consider the ratification of the treaty in coming weeks, allowing it to be put before the parliament in November.

Under an accord signed in January, Australia and East Timor will equally share revenue from the Greater Sunrise oil and gas field in the Timor Sea.

A spokeswoman for Australia's Department of Foreign Affairs and Trade said the treaty was expected to be tabled in federal parliament "in due course" after East Timor ratified the agreement.

Ramos-Horta has previously said he didn't anticipate any difficulty in getting the parliament to ratify the treaty.

Greater Sunrise - the largest known petroleum resource in the Timor Sea - includes the Sunrise and Troubadour fields, which together hold about 8 trillion cubic feet of gas and about 300 million barrels of oil, which may be worth up to US$40 billion.

Woodside Petroleum Ltd. (WPL.AU) owns and operates 33.4% of Sunrise, located 150 kilometers south of East Timor. Its partners are ConocoPhillips (COP) with 30%, Royal Dutch Shell PLC (RDSB.LN) with 26.6% and Japan's Osaka Gas Co. (9532.TO) with 10%.

The Sunrise partners are yet to decide where the gas will be processed with Woodside favoring Darwin and the East Timor government pushing for it to be processed in its country.

Australia and East Timor also signed a security agreement covering the Joint Petroleum Development Area in the Timor Sea on Thursday.

The security pact will allow each country to conduct surveillance operations and to respond - separately or cooperatively - to any threats to offshore oil platforms and facilities in the area.

Seven projects have production sharing contracts to operate in the Joint Petroleum Development Area, according to the Timor Sea Designated Authority website, including projects operated by Woodside and ConocoPhillips.

At a joint press conference with Australian Prime Minister John Howard in Canberra, Ramos-Horta also said his government wanted Australian peacekeeping troops to remain in East Timor at least until the country's next federal election in May 2007.

Australia has about 950 soldiers and police personnel in East Timor, serving alongside military personnel from New Zealand, Malaysia and Portugal.

The international deployment was sent to East Timor after an outbreak of violence in March, triggered by former Prime Minister Mari Alkatiri's decision to fire 600 soldiers.

East Timor was now much calmer than it was earlier in the year, Ramos-Horta said. He doesn't expect another outbreak of violence when an independent U.N. report on the earlier crisis was released, possibly as early as Monday.

Howard said the size of the Australian contingent was "appropriate" for now and he has no plans to reduce the force.

"We're going to keep a substantial presence there until the election," he said.

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