RAMOS-HORTA FLIES TO AUSTRALIA FOR GAS TALKS

CANBERRA: East Timor’s President Jose Ramos-Horta was scheduled to arrive in Australia on Tuesday for a state visit as negotiations over lucrative gas resources reach a critical stage for the Southeast Asian nation.

The East Timorese are gaining confidence that they can break a 20-year deadlock with the new Australian government over the development of Greater Sunrise, an estimated $50 billion in gas that lies beneath the seabed that separates the two countries.

Australia wants the gas to be piped to an existing liquefied natural gas (LNG) export hub in its northern city of Darwin. East Timor expects more economic benefit for the halfisland nation of 1.5 million people if Greater Sunrise energy is piped to its southern coast.

Australia and East Timor currently share revenue from the Bayu-Undan gas field in the Timor Sea that has been piped to Darwin since 2006. But that field is expected to run dry this year.

Without further oil and gas revenue, East Timor’s $19-billion sovereign wealth fund could be spent within a decade, according to La’o Hamutuk, an East Timorese research institute.

Ramos-Horta, who shared the Nobel Peace Prize in 1996 with East Timorese Bishop Carlos Belo for their efforts to end the conflict in their homeland, has suggested approaching new potential partners, including China, to finance an East Timor LNG plant.

The president has also suggested the Japanese, South Koreans and Indonesians as potential partners.

Australian Prime Minister Anthony Albanese described Ramos-Horta’s visit that ends on Sunday as an opportunity to deepen the two countries’ relationship, as well as to explore avenues for strengthened cooperation both bilaterally and in the region.

“Australia is committed to supporting Timor-Leste’s economic development,” Albanese said in a statement, using East Timor’s Portuguese name.

Michael Leach, an East Timor expert at Melbourne’s Swinburn University, described East Timorese talk of international partners as an effort to leverage Australia to agree to an East Timorese gas hub.

“The big blocking point is whether it goes to Darwin or the south coast of Timor,” he said on Tuesday. “What’s going to happen is anyone’s guess.”

A joint venture partner in Greater Sunrise, Australian company Woodside Energy, has raised technical concerns about piping the gas to East Timor.

While the gas field is much closer to East Timor than to the Australian coast, the route to Darwin is through the much shallower water.

The other partners are East Timorese state-owned company Timor Gap, which holds a 56-percent stake, and Japanese company Osaka Gas, which holds 34 percent.

Woodside said its current focus was on finalizing a production sharing contract for Greater Sunrise.

“Woodside remains committed to the development of Greater Sunrise provided there is fiscal and regulatory certainty necessary for a commercially viable development to proceed,” the company said in a statement.

“We understand and respect TimorLeste’s desire to process Sunrise gas in Timor-Leste. However, any development plan will need to be assessed against the criteria established” in a maritime boundary treaty signed between Australia and East Timor in 2018, it added.

Under the treaty, East Timor would receive 80 percent of the Greater Sunrise revenue if the gas is piped to Darwin and 70 percent if it is piped to an East Timorese plant.

The treaty also gives Australia the power to veto any partner that East Timor might choose.

During a visit to the East Timorese capital Dili last week, Australian Foreign Minister Penny Wong warned the nation against going into “unsustainable debt” to the Chinese in building a new gas hub.