Sunrise approaching Woodside’s gas horizon as negotiations move forward

Australian energy giant Woodside, alongside its joint venture (JV) partners and other stakeholders in the negotiation process, has confirmed the participants’ determination and commitment to realizing the development of long-stalled offshore gas and condensate fields.

Following a concept study deal Wood secured for the Sunrise and Troubadour gas and condensate fields, collectively known as Greater Sunrise, with the Sunrise Joint Venture (SJV) participants, including Woodside Energy (operator, 33.44%), Timor Gap (56.56%), and Osaka Gas Australia (10.00%), the latest round of negotiations was held to agree on the key governance documents that will set out the regulatory and legal frameworks to support the development of these gas and condensate fields.

To this end, Timor-Leste’s petroleum regulatory authority, Autoridade Nacional do Petroleo, accompanied by representatives from the Ministry of Finance and Ministry of Foreign Affairs and Cooperation, met with representatives from the Australian government’s Department of Industry, Science and Resources, Department of the Treasury, and Department of Foreign Affairs and Trade in Dili, Timor-Leste, along with representatives from the Sunrise Joint Venture to progress the negotiations on the petroleum mining code, the production sharing contract (PSC), and the fiscal (tax) arrangements.

“All parties reaffirm their commitment to developing a mutually beneficial and commercially viable Greater Sunrise project as soon as feasibly possible, consistent with the MBT. During this round of negotiations, the Sunrise Joint Venture provided an update on the concept study being undertaken by Wood on behalf of the Sunrise Joint Venture. All parties are looking forward to seeing the results of the study by no later than the fourth quarter of this year,” based on a joint communique statement.

This study will contemplate the main factors in developing, processing, and marketing gas, delivering it to Timor-Leste for processing and liquefied natural gas (LNG) sales or alternative gas delivery to Australia. In addition, it will encompass a range of disciplines, such as engineering, financial assessment and financing, local content, strategy and security, health safety and environment, and socioeconomic analysis.

The participants claim that “meaningful progress” has been made following the resumption of negotiations in October 2023, showcasing the commitment to working as quickly as possible to finalize the frameworks that underpin the development of the Greater Sunrise fields, which contain an estimated contingent resource (2C) of 5.3 Tcf of dry gas and 226 MMbbl of condensate (100%).

Located approximately 450 kilometers north-west of Darwin and 150 kilometers south of Timor-Leste, the development was discovered in 1974 and is expected to start producing natural gas by 2028-2030. Fast-tracking this project is perceived as one of the Albanese government’s top strategic priorities since it comes with a gas value of up to $33 billion.

Woodside is working on expanding its LNG footprint, as illustrated by the deal to acquire Tellurian and the U.S. firm’s proposed 27.6 million tonnes per annum (mtpa) LNG terminal in Louisiana.

The Australian firm has made this move to support its carbon competitiveness through increased exposure to LNG and the potential to reduce its portfolio’s average Scope 1 and 2 emissions intensity.