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Subject: East Timor may derail Woodside projec
also Australia's Woodside defends E.Timor LNG proposal, East Timor opposes floating gas plant; Woodside: East Timor's reaction premature; seeks talks East Timor may derail Woodside project XAVIER LA CANNA April 30, 2010 - 4:39PM AAP Woodside Petroleum Ltd will send a high-level team including chief executive Don Voelte to East Timor, after the tiny nation threatened to sink plans for a multi-billion-dollar gas project. East Timor, also known as Timor-Leste, on Friday accused the Australian oil and gas company of arrogance over a decision not to house a liquefied natural gas (LNG) processing plant on its shores. It threatened to pull the plug on a planned liquefied natural gas (LNG) development at the Greater Sunrise fields, between Australia and East Timor. The oil company responded at its annual general meeting in Perth, where Mr Voelte promised to send a delegation to East Timor next week. "Myself and the head of our Sunrise project, Jon Ozturgut, and our team will travel to Dili next week as well as to Darwin and speak to the Northern Territory's Chief Minister Paul Henderson as well as the various officials include (Jose) Ramos-Horta, the president of Timor Leste," Mr Voelte said. The statement from East Timor's government came after Woodside on Thursday revealed that joint venture partners unanimously agreed to use a floating platform to process LNG from the Greater Sunrise fields. Woodside is the operator of the joint venture project that also has participation from ConocoPhillips, Shell and Osaka Gas. Both Darwin and East Timor had been vying to house the $5 billion facility, which will process the gas from the huge field, believed to have a gas resource of 5.13 trillion cubic feet, plus 225.9 million barrels of condensate. East Timor's secretary of state for the Council of Ministers, H.E. Agio Pereira, on Friday said his nation was committed to building an onshore petroleum industry, which included a pipeline from his country to the Greater Sunrise field. "Timor-Leste will not approve any development of Greater Sunrise that does not include a pipeline to Timor-Leste," Mr Pereira said. "Woodside was acutely aware of the government's position before today's announcement but chose to proceed regardless. "This is not only a source of great concern, but reflects an unacceptable level of arrogance," Mr Pereira said. Mr Voelte said East Timor's reaction was premature. "I just know what is going to happen and that is the citizens of Timor-Leste are going to start to wonder why their government doesn't promote something that will improve their lives, will provide millions of dollars of income, provide jobs and everything else," Mr Voelte told the shareholders' meeting. "It is probably just a bit of positioning I suspect," he said. Woodside has said it chose the floating LNG option because under an agreement between East Timor and Australia in 2007 the fields had to be developed in line with best commercial advantage. RBS analyst Johannes Faul said Mr Voelte should have been smarter in the way he approached working with the East Timorese government. "He has obviously got them offside so now has to fly up," Mr Faul said. "It is all about damage control and to contain their (East Timor's) anger," he said. Shares in Woodside were up five cents at $45.50 on Friday. -- By Agence France-Presse, Updated: 4/30/2010 Australia's Woodside defends E.Timor LNG proposal Australia's Woodside Petroleum on Friday defended plans to process Timor Sea gas on a floating platform, after the proposal was angrily rejected by project partner East Timor. Woodside chief Don Voelte called using the new technology being developed by Shell a "phenomenal proposal" and "almost like manna from heaven" for the impoverished country. He was speaking after media reports that East Timor, which wants to pipe the gas to a permanent plant on its shores, had accused Woodside of "an unacceptable level of arrogance" over the plan. "Woodside was acutely aware of the governments' position before (Thursday's) announcement; but chose to proceed regardless," Secretary of State for the Council of Ministers H.E. Agio Pereira said in a statement, according to Dow Jones Newswires. "This is not only a source of great concern but reflects an unacceptable level of arrogance." "The approach has significantly compromised future relations with the government of Timor-Leste," he said. Voelte told Dow Jones that East Timor's reaction a "bit premature, in the respect that we haven't even given them the proposal, or the very thick book of detail behind why we came to the decision". He added that he will hold talks with East Timor officials in Dili next week. Australia and East Timor agreed to split multi-billion dollar revenues 50-50 from the Greater Sunrise gas field in 2006, after protracted wrangling over their maritime boundary. But the partners have never agreed on whether to build the plant to liquefy the gas for shipping abroad in East Timor or in Darwin, northern Australia. Shell last year said it was planning the world's first floating liquefied natural gas platform, which will be "significantly the largest vessel in the world" when built, according to the company. --- Associated Press East Timor opposes floating gas plant Associated Press<http://ads.forbes.com/RealMedia/ads/click_lx.ads/forbes.com/ap/story/id7563845/1165965853/x92/OasDefault_v5/default/empty.gif/522f6b756e3076617556414141715072>, 04.30.10, 04:22 AM EDT JAKARTA, Indonesia -- East Timor has rejected a proposal for a floating liquefied natural gas platform in a disputed Timor Sea gas field as a waste of time and money. Australian energy firm <http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=WOPEY.PK>Woodside Petroleum Ltd. (<http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=WOPEY.PK>WOPEY.PK - <http://search.forbes.com/search/CompanyNewsSearch?ticker=WOPEY.PK>news - <http://people.forbes.com/search?ticker=WOPEY.PK>people ), which leads a consortium developing the massive Greater Sunrise gas field, announced Thursday that its preferred option was to load tankers at sea from a world-first floating plant. But the government of East Timor, also known by its Portuguese name Timor-Leste, said the plan was not in the best interests of the country and reiterated that it wants a pipeline to its shores. Australia has also said it would like a pipeline to its northern city of Darwin. "The nation is firmly committed to building an onshore petroleum industry, inclusive of a pipeline to Timor-Leste from the Greater Sunrise field," Secretary of State Agio Pereira said in a statement. "Timor-Leste will not approve any development of Greater Sunrise that does not include a pipeline to Timor-Leste." Pereira said the consortium was fully aware of East Timor's position and that its alternate plan reflected "an unacceptable level of arrogance." --- Woodside: East Timor's reaction premature; seeks talks Reuters - Saturday, May 1 * Woodside says East Timor reaction premature, posturing * East Timor slams Woodside for "arrogance"; opposes plan * Woodside CEO to travel to Dili next week to meet officials * East Timor, Australia to hold talks in Dili on May 14 PERTH/DILI, April 30 - Woodside Petroleum Ltd <WPL.AX> said the East Timor government's opposition to its development plan for a major offshore gas field in the Timor Sea was premature, and that it would visit Dili next week to explain the merits of the plan. Woodside on Thursday said venture partners for the multi-billion dollar Sunrise liquefied natural gas project want to develop the field using a floating liquefaction platform, drawing stiff opposition from the East Timor government, which also accused Woodside of exhibiting an "unacceptable level of arrogance". The Greater Sunrise field contains an estimated 5.13 trillion cubic feet of gas and straddles Australian and East Timorese waters. Dili wants the gas developed on its shores, while Canberra has not declared a preference. "We will be going to East Timor next week to show them the full proposal ... we will get them to read the proposal and then evaluate it," Woodside Chief Executive Don Voelte told reporters after the annual general meeting. Voelte said the floating LNG plan was the most compelling and would bring more revenue to the citizens of East Timor than any other option. The venture would also commit to employing and training some people from East Timor, and help the impoverished nation build a new resource industry onshore. Australia and East Timor reached a deal four years ago to evenly split billions of dollars of field royalties, but East Timor's President Jose Ramos-Horta had wanted jobs from processing to be based in the impoverished country. Woodside ruled out building a liquefaction plant onshore, citing high costs and technical risks of building a pipeline across a deep ocean trench -- arguments disputed by East Timor. In a strongly worded statement, East Timor on Friday said it would not approve the Sunrise joint venture's floating LNG plan "now or in the future" and said Woodside's announcement was "a waste of valuable time". "Woodside was acutely aware of the governments' position before the announcement; but chose to proceed regardless. This is not only a source of great concern, but reflects an unacceptable level of arrogance," Secretary of State for the Council of Ministers, H.E. Agio Pereira, said in a statement. Woodside's Voelte dismissed those comments as "posturing". East Timor's Foreign Minister, Zacarias Albano da Costa, said his government would discuss the issue with Australia's Foreign Minister, Stephen Smith, during an official visit to Dili in May. "I don't want to comment much on the option. We have put it in the agenda to discuss that issue during a meeting in Dili, East Timor, on May 14," da Costa told Reuters. Da Costa reiterated his government's commitment to an East Timor-based LNG plant. Floating LNG technology owned by Royal Dutch Shell <RDSa.L>, is untried anywhere in the world, but Shell said the technology has undergone vigorous testing and it plans to use the first of the nine ships it is building on its wholly-owned Prelude field off western Australia. Partners in the Greater Sunrise field are U.S. major ConocoPhillips <COP.N>, Shell <RDSa.L> and Japan's Osaka Gas <9532.T>. (Reporting by Fayen Wong in Perth; Tito Belo in Dili; Editing by Sara Webb and David Fox)
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