Home Business East Timor seeks US strategic support in natural gas development

East Timor seeks US strategic support in natural gas development

by SuperiorInvest

In May I wrote about plans in the small island nation of Timor-Leste in the Indian Ocean to develop a potentially massive natural gas resource that lies between its southern coast and the northern shores of Australia. The Greater Sunrise field, first discovered in 1974, is believed to contain sufficient volumes of natural gas to completely transform East Timor’s economy in much the same way that offshore oil and gas revenues are currently transforming Guyana’s economy.

Indeed, this prospect of transformational change had many observers referring to East Timor as “the next Guyana”. No one disputes that the potential is there, but now Timor-Leste officials are trying to make it a reality and, in some ways, find what’s going on. Antonio de Sousa, President and CEO of Timor Gas & Petroleo (TIMOR GAP), traveled to the US this week looking for support and solutions to some current issues.

One area of ​​concern that has Mr de Sousa meeting with US officials this week involves the projection of US geopolitical interests in a part of the world where the Chinese government is aggressively asserting its hegemony. “I think there’s a broad understanding that it’s very much in the strategic interests of the U.S. for our company to produce this great field, but more than that for our country to be prosperous and successful,” de Sousa told me when I spoke to him on Tuesday caught up . “Because I think they realize that very few of these global partnerships and forms of cooperation can bear fruit if our country is denied the ability to develop its own resource base.”

One key question regarding resource development relates to how the government’s share of the operating joint venture, in which TIMOR GAP owns a 56.56% stake, will be financed. Mr de Sousa said TIMOR GAP was in discussions about this part of the equation not only with US officials but also with private equity sources. While he is unable to name specific names at this time, he told me that “some of the biggest oil and gas companies” have expressed strong interest in filling the role.

For TIMOR GAP, obtaining a solid source of funding is essential, as its absence has played a role in the extension until now point of controversy with the joint venture’s operating partner, the Australian company Woodside Energy. The issue involves the onshore terminal of the natural gas main that will eventually transport production from the Greater Sunrise Field. Woodside Energy is proposing to build a line to interconnect in Darwin on Australia’s north coast. On the other hand, the TIMOR GAP is constantly demanding that the line be built to a connecting point along the southern coast of Timor-Leste.

De Sousa told me that this point was not, in his view, up for debate. “The interesting thing for us, as a young country, is that we are able to observe the mistakes of others and potentially avoid them,” he said. “So that’s why the question of where to build the key infrastructure for this project was never negotiated.”

The main reason why a longer route to Australia is unacceptable for TIMOR GAP is that the company understands that its long-term prosperity depends not only on short-term revenues from gas sales, but on the second-order economic and social benefits of building a skilled and technical workforce from the ground up, preparing future generations of Timorese not only to work on these projects, but also to lead them.

The company has further plans to build a natural gas liquefaction and export facility that would allow it to export LNG to Indonesia and other countries in the region for the conversion of coal-fired power plants to natural gas and the resulting climate benefits. “The South Coast option is practically, technically, economically and strategically superior to any other plan being discussed,” de Sousa said, “and our company has done the technical work to prove it.”

While Mr. de Sousa believes that the decision to provide strategic support for the development of Greater Sunrise represents a major opportunity for the US to consolidate its geopolitical interests in the Indian Ocean region, he is confident that the resources underground will eventually recover. with or without American participation and support. “I think it’s been independently recognized from a technical standpoint as a world-class resource basin.” he said. “And if history has taught us anything, it’s that the world’s resource basin will eventually develop. The only question is when. Given what is happening in the world today and what we can expect in the near future, we believe the time is now.”

The opportunity is definitely there. Whether the current US leadership will decide to take it up as part of America’s ongoing geopolitical competition with China is anyone’s guess.

Source Link

Related Posts

%d bloggers like this: