Timor-Leste and Woodside Energy (WDS) have entered a new phase of collaboration after signing a Cooperation Agreement aimed at progressing a Timor-based liquefied natural gas development model for the long-delayed Greater Sunrise fields. The agreement represents the most substantive step forward in years toward resolving development pathways for one of the region’s most politically sensitive offshore gas projects.

The Government of Timor-Leste and Woodside will now jointly mature a greenfield LNG concept of roughly 5 million tonnes per year, incorporating domestic gas supply and a helium extraction facility. These studies will run in parallel with ongoing negotiations involving the Sunrise Joint Venture, as well as the Timor-Leste and Australian governments, to finalize fiscal, legal, and regulatory frameworks required to underpin an eventual investment decision.

According to the high-level plan embedded in the agreement, first LNG could flow between 2032 and 2035, contingent on timely concept selection and commercial approvals.

Timor-Leste’s Minister of Petroleum and Mineral Resources, Francisco da Costa Monteiro, said the deal underscores a unified commitment to finally unlock the value of the Greater Sunrise fields. He reiterated Timor-Leste’s longstanding position that an onshore LNG facility offers the best economic and strategic advantages, including domestic job creation, industrial development and greater national control over gas processing.

Woodside CEO Meg O’Neill framed the agreement as an extension of last year’s concept work, noting that critical outstanding issues still include the optimal downstream commercial structure—a key requirement for attracting financing—and determining the preferred pipeline route to transport Sunrise gas to Timor.

The Greater Sunrise fields, discovered in the 1970s, hold an estimated 5.3 Tcf of gas but have remained undeveloped for decades due to political negotiations, maritime boundary disputes, and disagreements over processing locations. Timor-Leste has consistently pushed for onshore development to anchor domestic industrialization, while past operator assessments favored processing in Darwin for cost and risk reasons.

A renewed diplomatic settlement of maritime boundaries in 2018 and Timor-Leste’s partial purchase of ConocoPhillips and Shell’s stakes shifted dynamics but did not resolve the technical and commercial hurdles. The latest cooperation framework signals a more constructive relationship and a clearer forward work plan.

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If the Timor-based LNG concept advances, it would mark one of the most significant industrial developments in the young nation’s history and reshape regional LNG flows in the Timor Sea.

By Charles Kennedy for Oilprice.com

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