Subject: East Timor Will Reject Darwin, Floating LNG For Sunrise
also Reuters: E Timor says won't approve Woodside gas pipe plan
East Timor: Will Reject Darwin, Floating LNG For Sunrise
(Adds Woodside comment)
By Ross Kelly
SYDNEY -(Dow Jones)- The East Timorese government has reiterated that it will reject any attempt by Woodside Petroleum Ltd. (WPL.AU) and its partners to process gas from the Greater Sunrise field either at Darwin or on a floating liquefied natural gas platform.
The government's statement appears to be at odds with a report by the Australian Broadcasting Corp. last Wednesday that quoted East Timorese President Jose Ramos-Horta as saying that a floating platform might benefit all sides.
In a statement posted on the East Timorese government's website on Saturday, Agio Pereira, a government spokesman, said: "The country is firmly committed to building an onshore petroleum industry, inclusive of a pipeline to Timor-Leste from the Greater Sunrise field."
Woodside has ruled out building an LNG plant on East Timorese shores, given the expense and technical risks of having to build a pipeline across a deep ocean trench.
Pereira said that the Darwin or floating LNG options would not be approved by the government and that Woodside "does not have any unilateral authority on decisions regarding the resources of Timor-Leste".
On Wednesday, in the ABC report, East Timor's Secretary of State for Natural Resources Alfredo Pires said that studies indicate that the onshore East Timor option is viable, and that floating LNG technology is still unproven.
"We must not forget that the floating LNG is a new option and...Timor-Leste should think about whether we want to be part of this guinea pig experiment, or we might allow other countries to try it first and then come back to us," Pereira said on Wednesday.
Woodside said Feb. 24 that it and its partners expected to choose between Darwin and floating LNG by March 31.
"We're aiming for a decision to be reached soon," a Woodside spokesman said.
Woodside operates and owns 33.4% of the project, while ConocoPhillips (COP) owns 30%, Royal Dutch Shell Plc (RDSB.LN) owns 26.6% and Osaka Gas Co. (9532.TO) owns 10%.
Perth-based Woodside acknowledges that it will need East Timorese government approval to develop the Greater Sunrise resource, which straddles Australian and East Timorese waters.
"We are in kind of a ticklish period with everybody on this thing," Woodside Chief Executive Don Voelte said last October. "But, at the end of the day, it is a good project that provides a hell of a lot of revenue to both countries."
-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; Ross.Kelly@dowjones.com
E Timor says won't approve Woodside gas pipe plan
Mon Apr 12, 2010 2:08pm IST
* E.Timor sticks to onshore LNG plan for Sunrise project
* Woodside: venture partners to decide development plan soon
* Delays could threaten Woodside's growth prospects (Recasts, adds background, Woodside response)
JAKARTA/PERTH, April 12 (Reuters) - East Timor on Monday again vetoed plans by Australia's Woodside Petroleum (WPL.AX) to develop a massive gas field away from its shores, threatening to delay the project and the company's growth prospects.
Tension between East Timor government and Woodside has heightened in the past year as both parties disagree over a potential development plan for the Greater Sunrise field, which straddles Australian and East Timorese waters.
Woodside has ruled out building a liquefied natural gas (LNG) plant on the East Timor coast, citing high costs and technical risks of building a pipeline across a deep ocean trench.
"The country is firmly committed to building an onshore petroleum industry, inclusive of a pipeline to Timor-Leste from the Greater Sunrise field and are equally committed to protecting Timor-Leste's resources for the benefit of all future generations," East Timor Secretary of State Agio Pereira said in an emailed statement.
Under a treaty signed in 2007 by the East Timor and Australian governments, any development of the Sunrise field must be approved by both governments.
A spokesman for Woodside, Australia's largest independent oil and gas producer, declined to comment on the East Timor government's latest statement, but said that project partners aimed to reach a decision on the development plan soon.
Woodside had hoped the joint venture partners would choose between Darwin and floating LNG by March 31.
Delays in developing the Greater Sunrise project, which holds estimated gas reserves of 5.4 trillion cubic feet, could put Woodside at a disadvantage in securing long-term customers.
Greater Sunrise is one of the three big development projects that are integral to Woodside's future growth prospects, along with its Pluto and Browse LNG project, so the company has been pushing ahead with plans to launch Sunrise as soon as possible.
However, with the Certain Maritime Arrangements in the Timor Sea treaty -- which provides for equal distribution of royalties from the field between Australia and East Timor -- due to expire in 2013, both governments could intensify efforts to resolve the stalemate, research firm IHS Global said in a recent report.
An official from Malaysian state oil firm Petronas [PETR.UL] said in January it had been advising the East Timor government on development of the lucrative gas field, which is also expected to contain 226 million barrels of condensate.
However, Dili said in February that the downstream development rights had not yet been awarded to Petronas nor Woodside nor any other company. [ID:nJAK335019]. (Additional reporting by Fayen Wong in PERTH) (Reporting by Sunanda Creagh; Editing by Sara Webb and Ed Lane)