Shell insists it remains committed to Timor Sea development
Shell insists it remains committed to Timor Sea development
Agence France-Presse, Sydney
Energy giant Shell on Friday dismissed a report it was set to quit the multi-billion dollar Sunrise gas project in the Timor Sea because of a disagreement with its joint venture partners.
The Sunrise gasfield is expected to generate the majority of East Timor's budget once fully operational and its abandonment would be devastating for nation which only came into being on May 20.
A report in the Australian newspaper quoting an unnamed company executive on Friday said Shell had threatened to walk away from the Sunrise project.
It wants to build a floating processing plant in the Timor Sea to develop the gas field but its partners want to locate the plant in the Australian city of Darwin.
Shell Development Australia chief operating officer Wim Hein Grasso denied any threats had been made, saying the company "is committed to develop Sunrise at the earliest opportunity".
East Timorese Prime Minister Mari Alkatiri this week described oil and gas revenue as his country's passport from poverty, saying without them the fledgling nation could never achieve true economic independence following its bloody split from Indonesia.
Alkatiri said East Timor, with one of the lowest per capita incomes in the world, desperately needed resource revenues so it could build basic infrastructure.
"If investors are turned away from the Timor Sea, revenues to Australia will certainly diminish but tiny, poor East Timor will have lost perhaps its most promising chance to wean itself off donor assistance," he said.
The two key Timor Sea deposits are found in the Bayu-Undan and Sunrise gas fields.
East Timor stands to gain an estimated US$3.5 billion from Bayu-Undan over 20 years and anywhere from eight to $60 billion from Sunrise over 30 years.
Shell owns a 26.56 stake in the Sunrise joint venture, with Woodside holding 33.44 percent, Phillips Petroleum 30 percent and Japan's Osaka Gas 10 percent.
They have spent a combined 110 million so far developing the project.