East Timor seeks US strategic support in the field of natural gas development

East Timor seeks US strategic support in the field of natural gas development

In May, I wrote about plans on the small Indian Ocean island of East Timor to develop a huge natural gas resource located between Australia’s southern and northern shores. The larger El Shorouk field was first discovered in 1974 and is believed to contain enough natural gas to transform Timor-Leste’s economy in exactly the same way that revenue from offshore oil and natural gas development is currently transforming Guyana’s economy.

Indeed, this possibility of transformative change has led many observers to refer to Timor-Leste as the “next Guyana”. Nobody doubts that the potential exists, but officials from Timor-Leste are now striving to make it a reality and find the rocky road in some ways. Antonio de Sousa, President and CEO of Timor Gas & Petroleo (TIMOR GAP), traveled to the United States this week in search of support and solutions to some of the issues at hand.

One area of ​​concern Mr. de Souza is meeting with US officials this week involves projecting US geopolitical interests in a part of the world where the Chinese government has firmly asserted its dominance. “I believe there is a widespread understanding that it is in the strategic interests of the United States for our company to produce this great field, but more importantly, for our country to be prosperous and successful,” de Souza told me when I met him on Tuesday. . “Because I think they realize that very few of these global partnerships and collaborations can pay off if our country is denied the ability to develop its own resource base.”

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One of the main issues related to the development of the resource relates to how to finance the government’s stake in the joint operating venture, in which TIMOR GAP holds a 56.56% stake. Mr. de Souza said Timur Gap is in discussions on this part of the equation not only with US officials, but with private sources of shares as well. While he is currently unable to name specific names, he tells me that intense interest in filling this role has been expressed by “some of the largest oil and gas companies”.

For TIMOR GAP, having a stable source of funding is critical because its absence thus far has played a role in prolonging the controversy with the joint venture’s operating partner, Australia-based Woodside Energy. The problem surrounds the onshore terminal of the natural gas main line that will eventually transfer production from the larger Shorouk field. Woodside Energy is proposing to build a line to connect Benny in Darwin, on the north coast of Australia. On the other hand, TIMOR GAP has consistently requested the establishment of the line for a connection point along the south coast of East Timor.

From his point of view, de Sousa told me, the point is not up for discussion. “The interesting thing for us, as a young country, is that we are in a position to watch and possibly avoid other people’s mistakes,” he said. “That is why the question of where to build the main infrastructure for this project has never been up for debate.”

One of the main reasons for not accepting the Longer Route to Australia for TIMOR GAP is that the company recognizes that its long-term prosperity depends not only on short-term gas sales revenues, but on the second-tier economic and social benefits that come from building a skilled and technical workforce of the millennium. To Z, future generations of Timurids are preparing not only to work on these projects, but to manage them.

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The company has other plans to build a natural gas liquefaction and export facility that will enable it to export LNG to Indonesia and other countries in the region to convert coal-fired power plants to natural gas and the resulting climate benefits. β€œThe South Coast option is more practical, technical, economical and strategic than any other plan being discussed, and our company has done the technical work to prove it,” said de Sousa.

While Mr. de Sousa believes that the decision to provide strategic support for the development of the Great Sunrise represents a key opportunity for the United States to advance its geopolitical interests in the Indian Ocean region, he is confident that the underground resource will eventually be recovered with or without American participation and support. “I think it has been independently recognized from a technical point of view as a world-class resource basin.” He said. β€œAnd if history teaches us anything, it is that world-class resource basins end up developing. The only question is when. With everything happening in the world today, and what we can expect in the near future, we think the time has come.”

The opportunity certainly exists. Whether the current US leadership will decide to capture it as part of America’s ongoing geopolitical competition with China is anyone’s guess.

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