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Part 1 Timor Sea
Part 2 Timor Sea (cont.)
What do East Timorese Activists Want from International Solidarity?
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Company Shares of Timor Sea Oil and Gas Fields |
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Each bar represents the amount of oil and gas resources in each field under the Timor Sea (22 Tcf circle on Australia map, previous page). Because it includes both gas and oil, the chart shows energy content in “Barrels of Oil Equivalent” (BOE). One trillion cubic feet (Tcf) of gas is equivalent to about 175 million BOE. Within each bar, each rectangle colored with a different pattern shows how much of the oil and gas from that field has been purchased by each company, as indicated on the right. Most of the oil in the Elang-Kakatua and Laminaria fields has already been extracted, and the bars show only the amount remaining. |
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The money to be made from Timor Sea oil and gas has attracted many international petroleum companies to East Timor’s neighborhood. The graph above shows which ones have purchased rights to sell the oil and gas. Phillips Petroleum (USA), Royal Dutch Shell (Great Britain and the Netherlands) and Woodside Australian Energy have the largest shares, and they are operating the oil industry here. Below and on the next few pages, we give some basic information about these and other companies which own gas and oil resources in the Timor Sea.
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Annual Revenues of Governments and Oil Companies |
| Multinational oil companies are huge and powerful institutions, larger than many governments. One way to evaluate their power is to look at the amount of money involved in their operations. The graph below shows how much money selected governments and oil companies received (revenues, sales and taxes) during 2001. For East Timor and the United Nations, the figures are from their proposed budgets for 2002. The United Nations number includes operations, administration, and peacekeeping everywhere in the world. |
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The following brief summaries of basic information and history describe the international oil companies with the largest involvement in oil and gas developments in the Timor Sea. We have tried to make the information accurate, but inconsistencies in reporting and availability of data have required some estimates and approximations.
Money is given in millions of U.S. dollars, according to each company’s Annual Report for 2001. “Assets” is the amount invested in the company, “revenues” is how much they received in 2001, and “profits” is how much was paid to the shareholders (owners) of the company during 2001.
Reserves are oil and gas still in the ground, estimated in millions of Barrels of Oil Equivalent (mmBOE), from annual reports and other sources. Unless marked as proved (1P), figures are Proved and Probable (2P), indicating a 50% likelihood of containing this amount of energy. One BOE will sell for approximately U.S. $20.
“Reserves in Timor Sea” shows the amount each company owns of both East Timorese and Australian parts of the Timor Sea oil and gas deposits.
The “Timor Sea part of reserves” percentage is an estimate of what part of each company’s worldwide total gas and oil reserves is in the Timor Sea. It indicates approximately how important the Timor Sea is to the company’s future.
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Phillips
Petroleum operates and owns 58% of the Bayu-Undan project and
some smaller fields in the JPDA, and is also a 30% owner of Sunrise. In
March 2002, Phillips announced plans to sell 10% of Bayu-Undan to Tokyo
Electric Power Company and Tokyo Gas, two Japanese companies who will
buy most of the gas from the field beginning in 2006. Phillips began dealing with the Suharto regime in 1968 and, in 1991, was in the first group of companies to sign contracts for Timor Gap oil exploration during the Indonesian occupation. The company continued to pay millions of dollars in royalties to Indonesia even after the August 1999 referendum in East Timor. During the UNTAET period, Phillips fought hard (with support from the U.S. government) to limit East Timor’s efforts to tax its operations. The company has invested approximately $1.6 billion in Bayu-Undan. Phillips is pushing for a pipeline from Bayu-Undan to Darwin, and hopes to include gas from Sunrise in this pipeline. Initially, they are selling the liquid fuels from the Bayu-Undan field, and pumping the “dry gas” back underground for later use. Phillips will merge with Conoco later this year to become the world’s seventh-largest oil company. Phillips works in all aspects of the oil and gas industry, from exploration and exploitation to refining and retail sales. For the past few years, Phillips has been shifting away from high-risk explorations (risk can come from doubt about oil resources as well as political uncertainty). At the same time, the company has been buying up smaller oil companies. Phillips’ Board of Directors includes two people who directly supported Indonesia’s occupation of East Timor:
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Phillips Petroleum |
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| Where based: United States Year founded: 1917 Number of employees: 38,700 Assets: $35,000 Revenues: $26,800 Profits: $1,661 Where do they get oil and gas?: USA, Alaska, North Sea, Cameroon, Nigeria, Somalia, China, Kazakhstan... Reserves worldwide (P): 8,700 Reserves in Timor Sea (2P): 1,200 Timor Sea part of reserves: 7% |
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Royal
Dutch Shell owns 27% and operates the Greater Sunrise field, and
has shares in several other Timor Sea oil and gas fields, including
Laminaria. It also owns 50% of the large Evans Shoal gas field and 35%
of Blacktip, in the Australian part of the Timor Sea, as well as
operating elsewhere in Australia. Shell has purchased more Timor Sea oil
and gas than any other company. It plans to liquefy the Sunrise gas at a
floating platform in the middle of the sea, since it wants to send the
gas north and east, rather than to Australia. This would be the first
such facility anywhere.
Shell is the second largest oil company in the world, with exploration and production on every continent. Shell signed contracts for the occupied Timor Sea in 1991, exactly 100 years after it first became involved in Indonesia (Dutch East Indies). The company has a long history of support for colonialism and repressive regimes, including the German Nazis until 1936. During the 1980s, Shell was the target of worldwide protests over its support for the racist apartheid regime in South Africa. More recently, the company has come under fire for collaborating with a dictatorship and human rights violations in Nigeria, Africa’s most populous country. Shell is accused of complicity in the 1995 execution of Nigerian playwright Ken Saro-Wiwa, an environmental activist who was hanged along with eight others for protesting oil exploration. In Europe, environmental NGOs have campaigned against Shell’s environmental practices, including dumping toxic waste from its platforms in the North Sea. |
| Where based: Britain/Netherlands Year founded: 1890 Number of employees: 91,000 Assets: $183,000 Revenues: $135,000 Profits: $12,000 Where do they get oil and gas?: 41 countries, including Nigeria, Brunei, Colombia, Malaysia, Gabon, Philippines Reserves worldwide (P): 19,100 Reserves in Timor Sea (2P): 1,350 Timor Sea part of reserves: 3% |
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Woodside
Australian Energy operates the Laminaria-Corallina oil field in
the disputed area just outside the JPDA, and owns 45% of that field. In
2000 and 2001, Woodside’s revenues from that field totaled U.S.$1.1
billion, 38% of the company’s income. Woodside now owns 33.4 % of
Greater Sunrise, after selling off 6.5% last year.
Woodside was one of the first purchasers of Timor Sea contracts, in 1991. The company originally supported Phillips’ proposal to build a pipeline to Darwin, but now supports Shell’s preference for a floating facility, with Japan as the principal customer. Woodside is an Australian company, with a minority of its operations
in Asia and Africa. Most of the company’s holdings are off the
Northwest coast of Australia, although most of its gas is sold to Asia,
with some to the Australian market. |
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Where based: Australia |
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Santos,
Australia’s largest gas producer, has been shifting its priorities
from on-shore production to the larger reserves offshore. Santos is
heavily invested in the sea off Australia’s northwest coast, mostly in
Australian waters. The company owns and operates the Petrel-Tern fields
near Darwin, and also has a 12% share of Sunrise and pieces of small
fields in the JPDA. It entered the Timor Sea in 1991, during the
Indonesian occupation of East Timor. In July 2002, Santos took over from
Shell as operator of the large Evans Shoal gas fields in the Australian
part of the Timor Sea, of which it owns 40%.
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| Where based: Australia Year founded: 1964 Number of employees: 1,713 Assets: $3,100 Revenues: $890 Profits: $272 Where do they get oil and gas?: Australia, Papua New Guinea, Indonesia Reserves worldwide (2P): 724* Reserves in Timor Sea (2P): 770 Timor Sea part of reserves: 50%* |
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Osaka Gas supplies gas to customers in the second-largest metropolitan area in Japan, representing about 32% of Japan’s total gas consumption. In an effort to diversity its sources of gas, Osaka purchased 10% of the Greater Sunrise and Evans Shoal fields in 2000. However, Osaka remains primarily a distribution and sales company, and is not directly involved in exploration and exploitation operations. |
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| Where based: Japan Year founded: 1897 Number of employees: 9,264 Assets: $10,600 Revenues: $7,683 Profits: $291 Where do they get oil and gas?: Indonesia, Brunei, Australia, Malaysia Reserves in Timor Sea (2P): 310 Timor Sea part of reserves: 11% |
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Inpex
was formed by Japanese energy companies to buy oil and gas from
overseas, initially from Indonesia but recently expanding worldwide.
They are responsible for more than one-quarter of all gas exported from
Indonesia to Japan. The company first entered the Timor Gap in 1992, and
now owns 11.7% of Bayu-Undan, as well as shares in some smaller fields.
Inpex also owns and operates the Abadi (Masela) field in the Indonesian part of the Timor Sea, east of East Timor. Abadi is not included in the graphs in this LH Bulletin. Half of Inpex is owned by the Japan National Oil Company, with the remainder divided among twenty other industrial and energy companies and banks, with the largest shares held by Japan Petroleum Exploration, Mitsubishi, and Mitsui Oil Exploration. Until last year, Inpex was known as Indonesia Petroleum Ltd. |
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| Where based: Japan Year founded: 1966 Number of employees: 227 Assets: $238 Revenues: $1,256 Where do they get oil and gas?: Mostly Indonesia, also Australia and 13 other countries Reserves in Timor Sea (2P): 130 Timor Sea part of reserves: 4% |
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Kerr-McGee
Corporation bought the Dallas-based oil exploration company Oryx
Energy in 1999. Oryx had been in the Timor Gap since 1991, and
Kerr-McGee owns 11% of Bayu-Undan.
A Kerr-McGee nuclear weapons plant in Oklahoma, USA, was implicated in the 1974 killing of employee Karen Silkwood as she was about to speak to the media. The company was charged with numerous instances of radioactive pollution, but has since left the nuclear weapons business. Kerr-McGee recently signed agreements with Morocco to explore for oil off the coast of Western Sahara. This African territory is illegally occupied by Morocco in defiance of the United Nations, similar to Indonesia’s occupation of East Timor. Last January, the UN Legal Office declared that “exploration and exploitation activities would be in violation of … international law principles.” It remains to be seen if Morocco and Kerr-McGee will respect that declaration, or if Morocco will permit the long-delayed referendum on independence to take place. |
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| Where based: United States Year founded: 1929 Number of employees: 4,638 Assets: $11,000 Revenues: $3,600 Profits: $486 Where do they get oil and gas?: Mostly USA, Gulf of Mexico, North Sea Reserves worldwide (P): 1,500 Reserves in Timor Sea (2P): 120 Timor Sea part of reserves: 4% |
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Eni, the
world’s sixth-largest oil company, owns Agip, which bought British
Borneo in 2000. In 1991, British Borneo purchased 6.7% of Bayu-Undan;
they later bought 30% of Blacktip. Eni is purchasing more of Bayu-Undan,
and will soon own 12.2%.
The company has oil and gas developments all over the world, and their investment in the Timor Sea is a small part of their total operations. |
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| Where based: Italy Year founded: 1926 Number of employees: 71,000 Assets: $60,000 Revenues: $44,000 Profits: $6,900 Where do they get oil and gas?: 67 countries all over the world Reserves worldwide (P): 6,900 Reserves in Timor Sea (2P): 120 Timor Sea part of reserves: 0.8% |
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PetroTimor
claims rights to oil and gas in virtually the entire JPDA based on a
1974 contract with Portugal. Today, its claims are not recognized by any
government. (See La’o Hamutuk Bulletin
Vol. 3, No. 4).
PetroTimor is part of Oceanic Exploration, a tiny company which owns
a few small businesses in different fields. Oceanic is owned by General
Atomics, a U.S. nuclear technology company owned by the Blue family.
One-fifth of PetroTimor belongs to East Timor. With fewer than 20 employees in several businesses, Oceanic Exploration has no capacity to develop East Timor’s oil resources. Rather, the company is hoping to extract money from companies currently working on Timor Sea oil. |
| Where based: United States Year founded: 1969 Number of employees: 18 Assets: $3 Revenues: $3 Profits (loss): -$2.9 Where do they get oil and gas?: Timor Sea and Kansas, USA Reserves worldwide: nearly 0 Claimed Timor reserves: 1,700 Timor Sea part of reserves: 99% |
La’o Hamutuk, The East Timor Institute for Reconstruction
Monitoring and Analysis
P.O. Box 340, Dili, East Timor (via Darwin, Australia)
Mobile: +61(408)811373; Land phone: +670(390)325-013
Baucau office: +61(438)143724; lhbaucau@easttimor.minihub.org
Email: laohamutuk@easttimor.minihub.org
Web: http://www.etan.org/lh
International contact: +1-510-643-4507, lh@etan.org