The AUS$300 million agreement for the 26.56% stake in the project will enable East Timor to push for development on the field. The field sits on the border of East Timor and Australia, and disputes regarding this border have led to long delays in development. According to Reuters, the purchase is conditional on whether or not funding approval is granted by the Timor-Leste Council of Ministers and National Parliament, as well as regulatory and other approvals.
This latest agreement follows ConocoPhillips’ decision to sell its 30% stake in the project in October this year. Reuters reports that the remaining partners in the project include Woodside Petroleum and Osaka Gas.
According to Reuters, the dispute over the border was settled earlier this year. Now, East Timor is reportedly looking to develop Greater Sunrise by transporting the gas via pipeline to an LNG plant on its south coast. Project partners, meanwhile, have been in favour of a plant located in Darwin, Australia.
According to Reuters, partners in the Greater Sunrise fields have stated that it would not be profitable to proceed with the Timor option.
Although analysts are reportedly not convinced about the chances of the field undergoing development within the coming 10 years (due to the fact that parties still need to agree fiscal terms, as well as tolling agreements), Reuters reports that development could begin if other parties decide to get involved, i.e. Chinese and South Korean companies.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/22112018/east-timor-reaches-agreement-to-purchase-shells-stake-in-gas-field/