Eni Selects FPSO Glas Dowr for Kitan Operations

Bluewater Energy Services B.V.

FPSO Glas Dowr Bluewater has received a Letter of Award from ENI for the Chartering, Operation and Maintenance of the upgraded FPSO Glas Dowr, complete with mooring system, including provision of logistics and ancillary services at the Kitan field. This Letter of Award remains subject to ENI obtaining approval for the contract from its co-venturers and from the East Timor government. The contract has a minimum term of 5 years after start of production and can be extended up to 10 years.  The Kitan field is situated in the Joint Petroleum Development Area (JPDA), approximately 170 km south of the Timor-Leste coast and 500 km north of the Australian coast, and is located in around 344m of water depth. Kitan is located in the permit 06-105 of the JPDA, an area jointly administered by Timor-Leste and Australia. ENI serves as the operator of the field and holds a 40% working interest; Inpex Timor Sea Ltd holds 35%; and Talisman Resources Pty Ltd holds the remaining 25%.

Dili 'will turn to Petronas'

Timor Leste may ask Malaysia's Petronas, not Australian giant Woodside Petroleum, to develop the offshore Greater Sunrise gas field, a government official claimed.

Upstream staff  Wednesday, 13 January, 2010, 13:00 GMT

In a statement rteleased earlier today, the government said it had rejected Woodside's pa plan by the Australian firm and its partners to develop the offshore Sunrise field without building an onshore plant to liquefy gas.
Government spokesman Agio Pereira told Reuters there were doubts about the commercial viability of Woodside's proposal to pipe gas from the field to either an existing liquefied natural gas processing plant in Darwin or to a floating LNG plant.
Any development of the Sunrise gas field, estimated to hold 5.13 trillion cubic feet of gas and 226 million barrels of condensate, must be approved by both the Australian and Timorese governments, according to a treaty signed in 2007.
Manuel Mendonca, director of communications in the natural resources ministry, told Reuters by phone that the government was now considering inviting Petronas to develop the field instead of Woodside.
"From [Timor Leste's] side, we just want to bring the pipeline to [Timor Leste], and we have differences in position on the options so we will contract another company to develop Greater Sunrise" if Woodside does not change its position, he said.
"The Malaysian company Petronas is qualified to develop the Greater Sunrise field."
This is the toughest stand Dili has made since Woodside announced early last year that it was no longer considering building an LNG plant in Timor Leste.
In a sign that relations between Woodside and Dili have soured dramatically, the government said all negotiations had ceased since Woodside shortlisted the development plans.
Woodside, however, has said publicly that talks with the government were progressing as planned.
Dili's rejection of the current Sunrise development plans would be a setback to Woodside's ambitions of swiftly developing the field and sanctioning the project in 2011.
"The current proposed plans of Woodside and the consortium partners to pipe gas from the Greater Sunrise field to either Darwin or a floating LNG would not be approved by the government of Timor-Leste," Dili said in the statement.
Woodside has argued that while Darwin is further from the field, it is less technically challenging and more cost-effective to pipe the gas to the Australian mainland.
It claimed building an LNG processing plant in Timor Leste would require the construction of a 200-kilometre pipeline which would cross a 3.3 kilometre deep trench. Woodside added that the Timor Leste solution would not only be more expensive, it carries "high technical and seismic risk".
Woodside said in November that the Sunrise LNG project could have a production capacity of about 5 million tonnes per annum if it was developed via the existing Darwin plant, while the floating LNG option would give an output of about 4 million tpa.
Timor Leste said concerns mounted after results from various feasibility studies commissioned by the government revealed conflicting conclusions to Woodside's original assertions.
source: upstreamonline.com

Dili's move 'will delay Sunrise start-up'

Timor Leste's opposition to Woodside Petroleum's proposals for the greater Sunrise development may further delay the project, JPMorgan Chase has claimed.

News wires  Friday, 15 January, 2010, 11:56 GMT

JPMorgan analyst Mark Greenwood said Dili's decision may see first gas from the Timor Sea field come on stream until 2016, rather than the initial estimate of 2014.
Greenwood added that Woodside has not yet set a firm date for first gas.
"If you look back at the history of this project, it has slipped and slipped and slipped again," he told Bloomberg.
"That's not to say it's not going to happen. But it seems there are more issues to work through."
Earlier this week, Timor Leste repeated its opposition to any development plan that does not include a processing plant on its soil.
Woodside and its partners, including ConocoPhillips and Shell, are considering whether to process the fuel on a floating liquefied natural gas plant or pipe it to Darwin in Australia's Northern Territory.
A Woodside spokeswoman said that under a treaty covering the field, Australia, Timor Leste and the Sunrise partners were "required to develop the reservoir to the best commercial advantage".
Timor Leste would not approve the Sunrise partners' proposals because the best commercial option for the gas was in dispute, Secretary of State Agio Pereira told Reuters earlier this week.
Manuel Mendonca, director of communications for Timor Leste's Natural Resource Ministry told the news agency that Dili may ask Malaysian state-run giant Petronas to develop the project instead of the Woodside-led group.
The option of piping the gas to Timor Leste for processing "had been eliminated unilaterally by Woodside without proper due assessment", Pereira claimed.
He added that Dili had carried out a study with Petronas evaluating Sunrise development options, he said.
In 2007, Australia and Timor Leste signed a treaty covering the administration of the Sunrise field, which straddles a boundary between Australian waters and an area jointly managed by the two countries, and share royalties.
The Australian government "remains firmly committed to the treaty", Michael Bradley, a spokesman for Resources Minister Martin Ferguson, told Bloomberg.
The government was waiting to receive a development proposal from Woodside and its partners, Bradley added.
Sunrise is estimated to hold about 5.13 trillion cubic feet of gas.

source: upstreamonline.com