Shell Australia has signed a sales and purchase agreement with the government of Timor-Leste, also known as East Timor, for the sale of its 26.56 per cent stake in the Greater Sunrise fields for $300 million, it said in a statement Wednesday.
The move comes after ConocoPhillips sold its 30 per cent stake in Greater Sunrise to Timor-Leste for $350 million in early October and now gives the Southeast Asian country a 56.56 per cent ownership of the asset.
This is significant because the development of Greater Sunrise was stalled due to a deadlock between Timor-Leste and its partners, as Timor-Leste insisted on an onshore LNG export terminal on its southern coast while its partners argued that a pipeline to an existing terminal in Australia was more feasible to export the gas.
If both the ConocoPhillips and Shell deals go through, Timor-Leste will have a majority share of the project and likely control its decision making process.
Australia’s Woodside Energy is the operator of Greater Sunrise with a 33.44 per cent working interest and Japan’s Osaka Gas has a 10 per cent.
Shell’s sale to Timor-Leste comprises Shell’s permits NT/RL2 and NT/RL4 within Australia waters and PSC 03-19 and PSC 03-20 within Timor-Leste waters and associated governance agreements, according to the statement.
The Sunrise and Troubadour gas and condensate fields, collectively known as the Greater Sunrise fields, are located around 150 kilometres southeast of Timor-Leste and 450 kilometres northwest of Darwin in Australia’s Northern Territory.
The Timor-Leste-Shell deal is conditional on funding approval from the Timor-Leste Council of Ministers and the National Parliament, as well as regulatory approvals and partner pre-emption rights, according to the statement.
The transaction, valued at $300 million, will allow the Timor-Leste Government and joint venture partners to pursue their aspirations for the Greater Sunrise development, EVP for Shell Australia, Zoe Yujnovich said.
“We respect the Timor-Leste Government’s determination to develop the Sunrise fields through an onshore LNG facility on its south coast,” she said.