East Timor seeks to extend maritime boundaries

In a move which could see Australia lose its biggest oil producing project as well as a potential major gas field, East Timor wants Australian to relinquish control over vast areas of the Timor Sea.
East Timor seeks to extend maritime boundaries East Timor seeks to extend maritime boundaries East Timor seeks to extend maritime boundaries East Timor seeks to extend maritime boundaries East Timor seeks to extend maritime boundaries

Speaking at the South-East Asia Australia Offshore Conference in Darwin, East Timorese Prime Minister Dr Mari Alkatiri told delegates that his nation rejected Australia's 80% claim over the Greater Sunrise gasfield, which is estimated to contain some 8.4 trillion cubic feet of gas reserves.

"Our claim is very clear: it applies to current international law," Dr Alkatiri said. "Sunrise should be 100% East Timorese."

"This is the point. That's where we are, but we are open to negotiation."

Dr Alkatiri said East Timor would also claim all of Australia's biggest oil producing field, the Woodside Petroleum-operated Laminaria field, which produces around 100,000 barrels per day of oil. However, Dr Alkatiri declined to say if the claim would be retrospective and cover past royalties.

In a move described by East Timorese officials as an "unfriendly act", Australia withdrew from the jurisdiction of the International Court of Justice in relation to some maritime boundary issues.

If maritime boundaries were to be changed, observers believe Australia could potentially lose hundreds of millions dollars in government revenue. In 2001, the Laminaria field alone provided $81 million to the Federal Government.

In other Timor Sea news, oil giant Shell gave a clear warning that the massive Timor Sea project might never be developed.

Shell said it was "not wedded" to constructing a $5 billion floating liquefied natural gas development of the Sunrise gas reservoir.

Shell Australia chairman Dr Alan Parsley told delegates at the SEAOCC conference that domestic market for gas needed to identified quickly because Shell was already in a position to supply the US west coast and Mexico and this remained the only commercial way to secure development of the Sunrise field.

It is estimated that $80 million has been spent in the past two years on identifying domestic customers without securing a contract. The current review is expected to completed in October.