BY ELIZABETH FABRI
AUSTRALIA and Timor-Leste are a step closer to settling a decade-long dispute over the $40 billion Timor Sea oil and gas field, after drafting up a new treaty both parties are set to sign by the year’s end.
In mid-October, The Permanent Court of Arbitration (PCA) announced the Government’s had reached an agreement on treaty text following a series of confidential meetings with the Conciliation Commission.
The draft treaty defines the maritime boundary and addresses the legal status of the Greater Sunrise gas field, the establishment of a special regime for Greater Sunrise, and pathway to development for the resource and the sharing of the resulting revenue.
Both countries had been in negotiations since the international court announced it would take on the case in September 2016; a last attempt to end the conflict.
“The Conciliation Commission has met regularly with the governments of Timor-Leste and Australia over the last year and has come to know their representatives very well,” Commission chair Ambassador Peter Taksøe-Jensen said.
“I am encouraged regarding the spirit with which the parties are approaching the joint development of resources. It has been a pleasure to see the governments of Timor-Leste and Australia forming a common position and standing together to ensure that the resources of the seabed are developed to the benefit of both peoples.”
Australia and Timor-Leste were now finalising domestic approvals, and engagement with the Greater Sunrise Joint Venture comprising Woodside (33.44 per cent), Conoco Phillips (30 per cent), Shell (26.56 per cent), and Osaka Gas (10 per cent).
The Greater Sunrise fields are located 150km south-east of Timor-Leste and 450km north-west of Darwin, NT, and contain 5.13 trillion cubic feet (Tcf) of gas and 225.9 million barrels of condensate.
On 6 November, Timor Leste and Australia began negotiations with the JV, which was the first time all parties had met together for several years.
The Timor-Leste Government has been adamant for years that the JV develop an onshore LNG processing plant on Timor-Leste soil instead of piping gas to the existing Darwin LNG plant or exploit the field through a floating LNG vessel.
However signs were beginning to look up for the JV, with Timor-Leste Prime Minister Mari Alkatiri reportedly telling The Australian “everything is on the table”.
“We’ve already agreed on the maritime boundary, we are now discussing with the joint venture the economics part of the agreement,” Dr Alkitari said.