Australia, RI agree to do more on Timor Gap projects<\/p>\n
By Riyadi<\/p>\n
NUSA DUA, Bali (JP): Australia and Indonesia agreed here on
\nThursday to provide more incentives for ongoing projects in the
\nTimor Gap's zone of cooperation (ZOCA).<\/p>\n
Indonesian Minister of Mines and Energy Kuntoro Mangkusubroto
\nand Australian Minister for Industry, Science and Resources Nick
\nMinchin noted in a joint statement that significant oil and gas
\ndevelopment opportunities exist in the ZOCA, the area shared by
\nAustralia and Indonesia.<\/p>\n
Preliminary engineering studies were completed in 1998 for the
\nupstream development of the Bayu-Undan gas field and development
\nplanning for the Jahal oilfield was well advanced, they said.<\/p>\n
\"Ministers agreed it was important to facilitate the
\ndevelopment of these opportunities,\" they said.<\/p>\n
The two ministers cochaired the ninth ministerial council
\nmeeting of the Australia-Indonesia Joint Authority for the Timor
\nGap Zone of Cooperation on Thursday.<\/p>\n
They said senior officials of both governments, in
\nconsultation with the joint authority and in consideration of
\nproduction-sharing contracts, would meet in May to finalize the
\nform of incentives for the projects.<\/p>\n
Kuntoro said more incentives were needed because exploitation
\nof gas and oil in the area was costly.<\/p>\n
\"As development of oil and gas projects in the area is
\neconomically not viable, we are considering giving them more
\nincentives. We will discuss this matter further in May,\" he said.<\/p>\n
Australia's Broken Hill Pty Co Ltd (BHP) and Phillips
\nPetroleum Co, big shareholders in the gap, have found a
\nsignificant amount of gas reserves in the Bayu-Undan field.<\/p>\n
They have proposed building a plant in the region to process
\nnatural gas reserves.<\/p>\n
BHP, as the lead unit operator, plans to commence production
\nfrom a new US$1.5 billion natural gas\/condensate project in 2002.<\/p>\n
But gas production has turned out to be not viable
\neconomically, Kuntoro said.<\/p>\n
BHP has begun commercial oil production from the gap's Elang,
\nKakatua and Kakatua North since July 1998, with revenue divided
\nevenly between Indonesia and Australia.<\/p>\n
Estimates put potential revenue from the Timor Gap at up to
\n$11 billion, based on reserves of 30 million barrels of oil and
\n175 million barrels equivalent of liquefied natural gas, plus
\nplentiful supplies of condensate.<\/p>\n
Kuntoro downplayed the estimate, saying the Indonesian side
\nhad collected only US$1.1 million from the Elang and Kakatua oil
\nfields.<\/p>\n
\"So far only Zone A (ZOCA) has proved to have oil and gas
\nreserves. We have not found any reserves in the other zones in
\nthe Timor Gap,\" he said.<\/p>\n
The Timor Gap treaty, signed by Australia and Indonesia in
\n1991, splits the sea between East Timor and Australia into three
\nzones, one Australian, one Indonesian and the ZOCA.<\/p>\n
The treaty is in effect until Feb. 2031 unless East Timor is
\ngranted independence by Indonesia. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/australia-ri-agree-to-do-more-on-timor-gap-projects-1447893297",
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