This file includes petroleum-related excerpts from:

	Budget Executive Summary  (link to complete document in PDF) as submitted to Parliament
	Government Program  (link to complete document in PDF)
	World Bank/ADB Economic and Social Development Brief  (link to complete document in PDF)

Transitional Budget Executive Summary (excerpts)

Note: Parliament added $8.5 million more in expenditures before approving the budget on 9 October.

As of 1 January (2008) Timor-Leste will move the timing of the budget cycle to a calendar year basis. In the meantime the 4th Constitutional Government has decided to formulate a budget to cover the transition period from 1 July 2007 to 31 December 2007.

Total revenue for the budget during the transitional period 1 July to 31 December is estimated at $579m.

The estimated petroleum revenue for the Fiscal Year 2006/07 was $683.3m in the 2006/07 Budget and adjusted to $841.5m in the Mid-Year Budget 2006/07. The actual revenue for 2006-07 was $1,004.5m due to higher oil prices than anticipated.

The Petroleum Fund as of 30 June 2007 was $1,394m. By the end of 2007 the Petroleum Fund is estimated at $1,910m. The Fund is expected to increase steadily in the medium term. The current forecast shows the total value of the Fund by 2008 of $2,906m and by 2011 of $5,550m.

Non Petroleum revenue for the previous fiscal year was $45.0m, consisting of $11.8m in direct taxes, $19.3m in indirect taxes, $6.7m in user fees and charges and $7.1m in revenue to autonomous agencies.

For the period 1 July to 31 December the domestic revenue is estimated at $22.5m. Direct taxes are estimated at $5.9m, indirect taxes at $9.6m, user fees and charges at $3.4m and revenue to autonomous agencies at $3.6m.

The Government faces a great challenge with managing the current level of funds carried over from the 2006-07 which is estimated to be approximately $119m, it has now reached a stage where it is almost a third of sustainable petroleum income. This practice is unsustainable and the Government is taking actions to reduce this carry over to manageable levels.  ...

Tables 1.1 and 1.2 provide details of the fiscal position of the Government, the main features of which are that:

	the fiscal deficit (accounting for the General Government Sector and the Autonomous Agency Sector) amounts to 85.6m;
	the Government will finance $40m of that deficit from a withdrawal from the Petroleum Fund and the remainder from the cash in the Treasury Account;
	subsidies flowing from the General Government Sector to the Autonomous agency sector amount to $15.3m for the transition period
	the Government estimates a cash balance of $63.7 m in the Treasury Account at 31 December 2007

Table 1.2
Estimated Cash Flow into the Treasury Account ($m)
This figure assumes the carry over is fully extinguished by payments by 31 December 2007.

Part 1 - The Budget for the Transition Period

The 2006-07 budget year finished on 30 June 2007, from the 1st of July the operations of Government have been financed via a 1/12th regime. These expenditures are based on the salaries and goods and services which were appropriated in the 2006-07 review of the General Budget of the State, as legislated by the UNTAET regulation 2001\13.

Part 3 – Revenue

Total revenue

The total revenue for the budget of the transition period 1 July to 31 December is estimated at $579m. The petroleum revenue comprises of 96 per cent of the total revenue. The current forecast for total revenue in 2008 calendar year budget will be $1,312m.

Table 3.1
Total Revenue 2006-07 to 2011 ($m)

Petroleum revenue

Petroleum Production

Currently there is only one field in operation in the Joint Development Area. The Bayu-Undan field is still in its early stage and it is expected that it will generate revenue to the government for up to 20 years. The production so far and projected production for the years ahead is generally in accordance with the schedule outlined in the 2006/07 Budget. The current oil prices are generally higher than assumed, but are subject to volatility.

Table 3.2
Estimated Petroleum Revenue 2006-07 to 2011 ($m)

Petroleum Fund

The estimated petroleum revenue for the Fiscal Year 2006/07 was $683.3m in the 2006/07 Budget and adjusted to $841.5m in the Mid-Year Budget 2006/07. The actual revenue for 2006-07 was $1,004.5m due to higher oil prices than anticipated. Assuming that oil prices (West Texas Intermediate) will average $65 and $62 during 2007 and 2008 respectively, the total petroleum revenue for the transition period is estimated at $556m and the petroleum revenue for the calendar year 2008 at $1,266m.

The Petroleum Fund as of 30 June 2007 was $1,394m. By the end of 2007 the Petroleum Fund is estimated at $1,910m. The Fund is expected to increase steadily in the medium term. The current forecast shows the total value of the Fund by 2008 of $2,906m and by 2011 of $5,550m.

Table 3.3
The Petroleum Fund 2006-07 to 2011 ($m)
This assumes that the Government will avail itself fully of the sustainable income in the period from 2008 to 2011.

Petroleum Wealth and Estimated Sustainable Income

The total Petroleum Wealth is estimated at 8,900m as of 1 July 2007. In addition to the total value of Petroleum Fund, the Petroleum Wealth consists of Net Present Value of future petroleum revenue of $7,500m.

The sustainable income for the budget during the transition 1 July to 31 December is estimated at $133m. According to the Petroleum Fund Law the sustainable income shall be 3% of the Petroleum Wealth.

Even if oil prices used in this calculation are lower than current market prices, it should be noted that the calculations are based on prices that are significantly higher than seen only few years ago.

Table 3.4
Revenue to the Petroleum Fund 2002 to 2025
 The figures represent undiscounted revenues to the Petroleum Fund, whereas Petroleum Wealth represents the Net Present Value of the future revenues and the current balance of the Petroleum Fund.

Graph 3.1
Petroleum Revenue and Sustainable Income 2002 to 2025

Review of methodology

The Petroleum Fund Act presupposes that the nominal yield on a US Government bond should be used when calculating the present value of the future cash flow from the petroleum sector. In August 2007 this rate was about 4.5 per cent, which has been chosen as the discount rate for the calculations.

Using a risk free interest rate when calculating the present value of future revenue has implications for the assumptions used, when estimating the cash flow. There should be a substantial likelihood that the cash flow will materialize. Hence we have based the calculations on the operator’s so-called P90 estimate, i.e. the production that will be achieved with 90 per cent likelihood. There are no similar price estimates available. We have, however, decided to use the low price case of a respected forecaster as a basis for making the price assumptions. Oil price assumption in the 2006/07 budget papers were based on forecasts made by International Energy Agency (IEA). IEA does not disclose the low price scenario. Prices are therefore based on Annual Energy Outlook 2007 published by the US Government’s Energy Information Administration. If the present value of the cash flow were to be calculated by using a risk adjusted interest rate, it would be appropriate to use the forecast for the expected production (rather than “P90”) and an expected price. This way of calculating the petroleum wealth would not lead to a materially different value when compared to the method described in the Petroleum Law.

Sensitivity Analysis

There are a range of risks and uncertainties in any forecast of petroleum revenues. The most sensitive assumption is oil price, meaning that the forecast of petroleum revenues changes substantially even from a relatively small change in assumed oil prices. Other uncertainties include LNG contract volume and pricing terms, condensate and LPG spot sales prices relative to oil prices, operating costs and inflation. The Ministry of Finance has endeavoured to adopt prudent assumptions in all cases.

Table 3.5 shows the sensitivity of petroleum revenues, petroleum wealth and sustainable income to changes in production and prices.

Table 3.5
Sensitivity Analysis of Petroleum Revenue 2006-07 to 2011 ($m)
The Budget is based on the Base analysis.  The low price is based on oil prices at $10 pbbl lower than assumed by MoF officials, high price is based on oil prices at $10 higher ppbl higher than assumed by MoF officials.  Expected production is based on the figures the provided by the operators.

Graph 3.2
Actual and Predicted Oil Price Forecasts to 2016

There is a risk, however small, that there might be an event on Bayu Undan field that will cause a deferral of the revenue stream. Such deferral may last for months, years or even indefinitely, depending on the event. Furthermore, oil prices are very volatile, and it should not be ruled out that oil prices fall to or below the price assumptions used in the calculations of the Petroleum Fund.

In calculating the Petroleum Wealth only fields in production are included. As there is no development plan for Greater Sunrise yet, potential Timor-Leste revenues from this field are not included in the Petroleum Wealth, nor are potential revenues from the acreages opened for exploration.

Table 4.4
Total Measures for 2007 Budget for the Transition Period (excerpts)

Secretary of State for Natural Resources

Role

The Office of the Secretary of State for Natural Resources is the Government’s main body responsible for mineral and natural resources, including oil and gas, as well as the activities of the mining, petroleum and chemical industries.

The main activities in the Secretary of State for Natural Resources will involve:

	designing policies and drafting the necessary laws and regulations for the areas under its responsibility;
	setting up contacts with international investors so as to attract investment to the national territory, in the areas under its responsibility;
	drafting laws and regulations on matters pertaining to its area of responsibility;
	monitoring the implementation of international treaties in its area of responsibility;
	determining, in view of market trends, the conditions for the exploration of resources;
	ensuring a transparent management of resources, in line with international practice;
	managing oil resources and the activities of the petroleum industry according to the legislation on oil;
	authorizing and supervising production sharing contracts, licenses and approvals;
	promoting new explorations of oil resources and develop those already in existence;
	maintaining an information database on oil operations and resources;
	measuring and verify oil production and reserves;
	setting up a monitoring and inspection program to ensure that the operators perform according to the terms of their licenses, and according to the law and the regulations;
	licensing mining operators; and
	setting up collaboration and coordination mechanisms with other Government bodies responsible for related areas.

	establishment of a new National Directorate of National Administration and Finance;
	establishment of a new National Directorate of Natural Resources Planning;
	establishment of a new Office of the Secretariat of State (including international advisers to provide specific technical advice); and
	incorporation of the Geology and Mineral Resources Directorate from the former Ministry of Natural Resources, Minerals and Energy; and
	incorporation of the Petroleum and Gas Directorate from the former Ministry of Natural Resources

Table 4.17
2007 Staffing Profile Secretary of State for Natural Resources

Secretary of State for Energy Policy;

Role

The Office of the Secretary of State for Energy Policy is the Government’s main body responsible for energy resources.

The main activities in the Office of the Secretary of State for Energy Policy will involve:

	defining and proposing to the Government guidelines on energy policy;
	executing and ensuring the implementation of the policy approved by the Government under the previous sub-paragraph;
	developing the legal and regulatory framework for the activities connected with energy resources;
	promoting contacts with international investors so as to attract external investment to the areas under its responsibility;
	regulating, in coordination with other ministries, operators in the area of power generation;
	developing studies on the capacity of energy resources and alternative energies;
	maintaining an information databank on energy operations and resources;
	coordinating and promoting the management and updating of the infrastructures in the areas of power generation; and
	ensuring the coordination of the energy sector and stimulating complementarity among its various modes, as well as their competitiveness, so as to better satisfy the users;

	transferring the Division for Research into Renewable Energy Policy from the former Ministry for Natural Resources, Minerals and Energy Policy;
	creation of a new Office for the Secretariat of State of Energy Policy;
	transferring the Division for Research into Alternative Energy Policy from the former Ministry for Natural Resources and Energy Policy;
	creation of a new Finance and Administration Directorate; and
	movement of the Management of EDTL contract to the Ministry of Infrastructure (formally included in the Division for Research into Renewable Energy Policy),

Table 4.19
2007 Staffing Profile Secretary of State for Natural Resources

DEMOCRATIC REPUBLIC OF EAST-TIMOR
PRESIDENCY OF THE MINISTERS’ OFFICE

IV CONSTITUTIONAL GOVERNMENT PROGRAM
2007-2012

Chapter I  Economic Growth

4. Natural Resources

East-Timor is rich in natural and mineral resources, including oil and gas. Some of these resources are already being exploited but most of it is not and is still waiting to be developed for the benefit of the economical and social development of the country.

This Government advocates a clear policy in the use of the natural and mineral resources, taking into account the country’s context, privileging the national role players, creating jobs and promoting the sustainable development, through the planning, coordination and harmonization of cross-cutting policies, taking into account the need to render compatible the environment preservation, the management of natural and mineral resources and the improvement of the population’s quality of life.

Only a National Development Strategic Plan can guide the controlled and efficient use of the revenues deriving from those resources and can guarantee a safe investment plan to generate new revenues. For that purpose, it is fundamental management transparency of that process and that transparency can only exist if the natural resources matter is not exclusive of the governing parties and of the politicians in power.

Another fundamental aspect is to combat political parties’ one sided decision in this sector, both in the organizations working this matter and in the control mechanisms that should essentially comply with technical and professional competences recognition criteria.

The Government undertakes the obligation to do the natural resources management guaranteeing their sustainability in order to develop a macro-economic framework that protects the this generation’s interests and safeguard the interests of future generations; thus it is going to define, in its National Development Plan, the priorities that should be addressed right away and is also going to define the time and amount for saving, with a clear investment plan of the revenues deriving from the natural and mineral resources to generate new revenues which will promote an irreversible economic growth of East- Timor.

To achieve that goal, the Government will give priority to the following aspects:

	Establish an integrated program for human resources development in this sector. Which will include the granting of student grants and the creation of a Geology and Oil Institute, in close articulation with National University;
	Proceed, in articulation with the sector authorities and under the coordination of the State Secretary for Natural Resources, with a reform that will include the remodelling of the technical staff and management staff allocated to the sector;
	Promote the approval of Laws and Regulations to respond to the real needs of the country;
	Establish policies and create national sustainable management mechanisms that enable the Government to exercise an effective supervision, regulation and control in this area;
	Regulate the activities and establish international agreements, favourable to the creation of jobs for the Timorese;
	Promote and attract the investment in the oil sector in national territory, with the purpose of bringing the pipeline to East-Timor;
	Promote environment protection policies in the exploitation of mineral resources;
	Formulate, in cooperation with the Secretary of State for the Energy Policy;
	Establish a National Oil Company;
	Develop studies and geological surveys in the whole territory, with the purpose of producing a new geological map of the country and do the first mineral and oil resources inventory “onshore”;
	Create mechanisms so that the Oil Sector becomes gradually separated from political issues;
	Promote transparency and rigour in this sector through the creation of a “Initiative for Transparency, of the IV Constitutional Government”, denominated: “East-Timor Transparency Model”;
	Create a “Non-Renewable Natural Resources Commission”, composed by members appointed by the five largest political parties, this Commission should be autonomous and will operate as an organization of a consulting nature, submitting recommendations to the Sovereignty Bodies;
	Maintain a population information policy about this sector development, as a strategic matter for the national development.

	To analyse the already developed studies and projects about hydro-electrical plants, biomasses, bio-gas, gas, oil from the Timor sea, with the purpose of developing the exploitation and production of energy to produce electricity and other domestic uses, with special emphasis for Gas Seep Aliambata, the project of the hydro-electrical dams of Ira Lalaro, Ainaro and Maununo, as well as bio-masses;
	Establish control and inspection models and regulating standards of the projects already carried out or to be carried out;
	Prepare legislation that regulates and unifies the study, exploitation and production studies on renewable or non-renewable energy sources;
	Speed up the Ira Lalaro energy project;
	Monitor the bio-masses activities and the Gariwai mini-hydro-electrical plant;
	Establish an electrical power network for Oe-Cusse Ambeno, based on the use of alternative energies.

	Reduce the intensity of energy dependence, minimizing the import flow, through the use of alternative and renewable energy sources, such as: hydro-electrical, bio-masses, bio-gases, solar energy, turbines, wind kinetic energy; chemical energy stored in vegetables and microorganisms, potentially abundant in the country;
	Promote the good multi-purposes hydro-electrical use for the production of energy and the good use of water;
	Regulate the exploitation of alternative or renewable energy sources, also contributing for the uniformization and integration of several projects to be developed in the country in this field;
	Supply/provide energy to the population living in isolated areas;
	Assure the benefit of the country’s energetic richness to future generation, through the definition and preservation of “obligatory reserves”, both from renewable sources and from nonrenewable sources;
	Create adequate regulations so that the national operators will play a relevant paper in the energy resources exploitation;
	Develop balanced safety standards, with the purpose of the exploitation, production, supply and provision continuity;
	Develop training programs for operators and consumers, also encouraging the consumption environmentally cleaner energies;
	Adapt investment programs of electrical power network operators with the purpose of interlinking the decentralized production; In order to promote national competitiveness, the Government undertakes the obligation to create conditions to provision the market, liberalizing it (improving the services and promoting cooperatives and the privatization of the sector), carry out feasibility studies on energy production for the national and international market and finally create foreign investment attracting mechanisms.

	Definition of an environmental policy and natural resources with a view to the integration of the environmental component in the different sectoral policies, based on principles of sustainability, mainstreaming, integration, equity and participation, enhancement of natural resources that sets the agricultural and forestry development within the framework of nature conservation. Consequently, a National Plan shall be elaborated to implement that Policy;
	Elaboration of the Basic Environment Law and consolidation of the legislation concerning the current and also the potential Protected Areas, the Evaluation of Environmental Impacts and Control of Pollution, in order to make it possible to give an adequate response in terms of environmental policy. In particular, the legislation concerning the environmental impact studies is aimed primarily at analyzing certain activities and projects that, due to their own dimension or nature, represent added pressures on the environment, in the stage prior to licensing;
	Adoption of legislative measures, namely of the penal nature, with regard to the Defense of environment, privileging the Defense of landscape, of natural resources and environment in general;
	Adaptation or replacement of the existing different legal environmental instruments that affect the current legal system, in order to provide an environmental legal framework adapted to the reality of East-Timor;
	Implementation of the Multilateral Environmental Agreements signed by East-Timor, respectively the 3 Rio Conventions (UNFCCC – United Nations Framework Convention for Climate Changes, UNCBD – United Nations Convention for Biological Diversity, and UNCCD – United Nations Convention for Desertification). As this is one of the most critical and fundamental areas of environmental intervention and also a cross-cutting issue from the definition of global policies to the implementation of projects of national and local application, the Government shall provide the necessary means to manage the sector and therefore fulfill the responsibilities and interests of East- Timor as an effective member of the conventions;
	Encouragement of the participation of citizens and all stakeholders with a view to make it possible to easily have access to information on environment. Awareness campaigns shall be launched targeted to the population and a programme of environmental education shall be promoted, inside and outside the educational system, which allows for the awareness and training of the citizens in the different fields of environment.
	In particular at local level, where the environmental awareness is extremely necessary the Government shall encourage environmental awareness plans that involve environmental focal points, in order to stimulate the link between the Central Government, Districts and “Sucos”;
	Elaboration and implementation in the Country of a National Surveillance Network of the quality of environment, by making use of technical and computer tools for the purpose. Laboratory and technical tools shall be progressively reinforced to analyze and evaluate the Water, Soil and Air Quality;
	Implementation of the system of Pollution Control through the approval of relevant legislation and implementation of an Environmental Licensing System;
	Promotion of the elaboration of a National Policy of Waste Management and, subsequently the elaboration of a National Plan for its correct implementation, investing on the preventive actions of waste production;
	Promotion and development of integrated systems of collection, treatment, enhancement and final disposal of waste per type (for example, waste oils, metals and plastics);
	Encouragement of collection, separation and recycling actions and initiatives to recover the waste that is liable to be enhanced;
	Focus on the definition of a National Policy, Strategy or Plan to Preserve Nature and Biodiversity, in consultation with the international agreements signed by East-Timor, and which takes into account cynegetic species, animals’ rights in general, trade of plants and animals, protection of grooves of trees, preservation of biotypes and protection of rare/protected plants;
	Promotion of the Defense of the National System of Protected Areas, by articulating the policies of environment and Land Planning.
	Approval of new legislation on Protected Areas, by reviewing and updating the UNTAET rules and regulations;
	According to the legislation approved, new protected areas throughout the Country should be created.

Fiscal Operations (Central Government Budget, cash basis, fiscal year (July-June)), $ million

e = estimate, p = preliminary;

1/ $10.5 million of the $15.7 million capital expenditure for FY2005-06 was for the capitalization of the BPA

Sources: Timor-Leste authorities, IMF, and World Bank

9. Sector Note: Petroleum

Overview

Timor-Leste's petroleum revenues and savings arrangements will ensure the country's economic future. The savings arrangements allow for sufficient and sustainable funds to be used each year to fund the state budget, but to date Government has had trouble spending the annual budget. Timor-Leste’s petroleum revenues amounted to USD1.2 billion as of March 31, 2007, and are increasing at a pace of USD 100 million/month since January 2007. While providing resources for the country’s development, petroleum revenues also pose economic and governance challenges. International experience shows that countries rich in natural resources often experience more wasteful spending and corruption than other countries. To avoid this “resource curse,” Timor-Leste adopted arrangements for good management of petroleum revenues for the benefit of current and future generations.

Key Issues

• Maintaining petroleum revenue management arrangements. These arrangements provide the basis for good governance of petroleum revenues. Saving for the future is important because petroleum resources will not last forever. At the same time effective spending from these revenues is necessary to develop and grow the non-petroleum economy, provide services, and reduce poverty.

• Developing Greater Sunrise. Through the Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS), which entered into force in February 2007, Timor-Leste and Australia agreed to share 50/50 the revenues from the Greater Sunrise gas field. However, an agreement on how to develop the field has not yet been reached. This is largely due to discussions regarding where a pipeline from the field will go. Timor-Leste should establish an informed, consensus position on Sunrise development in preparation for such discussions. Commercial, social, and economic aspects should be taken into account.

• Reorganizing the Sector. In April 2007 the Oil and Gas Directorate put out for public comment draft legislation on a successor agency to the Timor Sea Designated Authority. Draft legislation on the creation of a national oil company was also put out. In line with the process followed for Timor-Leste’s overall petroleum legislation, broader consultation and engagement with sector legal experts on scope and governance arrangements for these entities are warranted.

The Sector

All petroleum revenues that come to Timor-Leste are deposited in a Petroleum Fund managed by the Banking and Payments Authority (BPA). The Fund is governed by the Petroleum Fund Law, which spells out the formula for calculating the amount of “estimated sustainable income” that can be transferred from the Fund each year to finance the state budget. Estimated sustainable income is the amount that can be withdrawn from the Fund in perpetuity without decreasing the country’s petroleum wealth. Each year the amount of sustainable income is verified by an independent auditor. If the country follows this savings rule, it will have money available to finance its budget forever. Money from the Fund can only be transferred after approval of the annual budget by the Parliament and can only go to the budget.

Timor-Leste's petroleum management arrangements are designed to maintain transparency and accountability. The BPA issues quarterly reports on the Petroleum Fund, including its balance, any transfers, and its investments. These are publicly available. According to the law, an internationally recognized auditor must complete an independent, external audit of money received by the Fund each fiscal year. The auditor’s report must be published. Made publicly available in July 2007, the first Annual Report, including the Fund’s audited financial statements, and the quarterly reports are available from the BPA or at www.bancocentral.tl/PF/Reports.asp . An Investment Advisory Board advises the Government on the investment strategy and management of the Fund. An independent Consultative Council, including civil society and private sector representatives, advises Parliament on the Fund.

The former Ministry of Natural Resources, Minerals and Energy Policy (MNRMEP) and now possibly the Secretary of State for Natural Resources is responsible for petroleum resources in Timor-Leste’s territory. The TSDA, a joint Timorese/Australian agency, is responsible for petroleum resources in the Joint Petroleum Development Area (JPDA) in the Timor Sea. The JPDA is governed by the 2002 Timor Sea Treaty (TST), under which Timor- Leste and Australia agreed to split JPDA revenue 90/10 in favor of Timor-Leste. According to the 2002 Timor Sea Treaty after three years the TSDA would be folded into an Oil and Gas Directorate or become a different Timorese agency.

In developing Greater Sunrise, Timor-Leste has favored the pipeline coming to its south coast along with the establishment of an LNG plant. Woodside, the main operator of the field, and Australia have favored the pipeline going to Darwin (where there is an existing LNG plant). Woodside and its joint venture (JV) partners (ConocoPhillips, Shell, and Osaka Gas) aim to prepare a preliminary development plan for Sunrise by September 2007. The plan will require agreement by the Governments of Timor-Leste and Australia. If Timor-Leste insists on a development concept that differs from what the JV believes to be in the JV’s commercial interest, the JV may require compensation from Timor-Leste.

In addition to the Petroleum Fund Law, a Petroleum Law, Model Production Sharing Contract (PSC), and Petroleum Tax Law were adopted in 2005. This completes the legal framework governing the exploration and development of petroleum resources in Timor- Leste’s territory. These laws are in line with international good practice. Timor-Leste is also implementing the Extractive Industries Transparency Initiative (EITI).

Timor-Leste’s petroleum production is currently primarily from the Bayu Undan gas field in the JPDA. Bayu Undan is estimated to generate about USD9.4 billion in accumulated revenue for Timor-Leste over the next 15-20 years. Greater Sunrise is estimated, on a very preliminary basis, to generate around USD24 billion in revenues over the life of the field, half of which would go to Timor-Leste. As Sunrise is not under production its revenue projections are not yet included in sustainable income estimates now produced for the budget. Exploration rights in Timor-Leste’s territory were awarded in 2006 to ENI and Reliance. While this could be another source of petroleum revenue, a commercial discovery must first be found and development concepts agreed before production starts/revenue flows. This is likely to take several years.

Facts and Figures

Timor-Leste Production Profile, 1999-2041 (million barrels of oil equivalent)*
*At this stage, Sunrise profiles should be considered as very broadly indicative only.

Timor-Leste Projected Petroleum Revenue Profile, 1999-2041** (USD million)
**Projections are extremely sensitive to oil price assumptions, to which LNG prices are linked