Lindsay Murdoch - January 3, 2011 - THE SYDNEY MORNING HERALD
A PROPOSAL has emerged for Woodside to supply gas for East Timor's domestic consumption as a way to break a deadlock in negotiations over the multibillion-dollar Greater Sunrise field in the Timor Sea.
However, East Timor is still insisting that the Perth-based company drops its plan to build one of the world's first floating liquefied natural gas (LNG) platforms at the field and instead bring all of the gas to a processing plant in East Timor.
The proposal is to provide a small amount of Greater Sunrise's gas for a LNG plant that East Timor wants to build at Beaco Beach on the country's south coast, where the government has set aside 250 hectares of land.
No plans for the supply of gas have been tabled in formal negotiations, which remain acrimonious after months of high-stakes claims and counterclaims.
Woodside denies making an offer to build a domestic gas pipeline to East Timor. ''The floating LNG option maximises total petroleum revenue to Timor-Leste and Australia,'' a company spokeswoman said. ''The joint venture is committed to redelivering sustainable benefits to the people of Timor-Leste.''
East Timor has spent tens of millions of dollars commissioning studies it says shows a pipeline could be built from the Greater Sunrise field to East Timor across a deep seabed trench.
A floating LNG platform remained the preferred development option for the gas field, the Woodside spokeswoman said, to maximise the commercial advantage.
Woodside has chosen a floating LNG platform in preference to piping the gas to East Timor, or to an existing processing plant in Darwin.
In recent weeks the government in Dili has warned of potential cost blowouts if a floating platform is to be built and accused Woodside of making misleading statements about the project.
The Prime Minister, Xanana Gusmao, has repeatedly said East Timor is prepared to forgo billions of dollars from Greater Sunrise, making a stand against corporate giants that plunder the resources of tiny nations.
Despite the deadlock, East Timor has allocated $US12.4 million for research into an LNG processing plant at Beaco Beach.
It is also planning to spend at least $US36 million to develop a south-coast petroleum infrastructure corridor. The government has said it wants the LNG plant at Beaco Beach to have a production capacity of up to 20 million tonnes of LNG a year.
La'o Hamutuk, a non-government organisation in Dili that monitors Greater Sunrise developments, said in a report it seemed unlikely any studies or information from East Timor would change Woodside's view that a floating LNG platform would be $US2 billion cheaper than bringing gas to be processed on shore.
La'o Hamutuk said: ''If Woodside is not persuaded, the project will remain stalled and Timor-Leste's $US12.4 million or more will have provided work for foreign consultants and contractors, but no benefits for our people.''
Under agreements reached in 2007, East Timor and Australia would equally share profits from the Greater Sunrise field.
