SUNRISE GAS FIELD TIMOR SEA, AUSTRALIA

A number of companies have announced plans to develop the Sunrise gas field in the Timor Sea off the north west coast of Australia. The aim is to combine the early gas delivery potential of the Bayu-Undan gas and condensate development with the large reserve base of the Greater Sunrise fields. When combined, the projects will be able to meet the needs of a large customer base in the Northern Territory and other parts of Australia. Sunrise has the potential to support liquefied natural gas, methanol, power generation and other gas based industries including minerals processing. The gas has to be accessed using offshore drilling rigs, with the attendant facilities such as subsea pipes, Christmas trees, tankers and so on. Shell have unveiled plans for utilising a pioneering floating LNG production platform for exploitation of the field.

THE SUNRISE GAS FIELD

Offshore exploration of the Bonaparte Basin off the north west coast of Australia during the mid 70s led to the discovery of the Sunrise and Troubadour gas fields. Together with the Sunset gas field, they comprise the Greater Sunrise gas fields, a major resource of over 9 trillion cubic feet of gas located about 500km north west of Darwin.

Shell and its partners in the project are working towards the commercialisation of the vast reserves in this area. Extensive appraisals of the gas fields have been completed, with the largest single 3D seismic programme in Australia undertaken from July to September 2000. The area can provide gas resources for over 30 years and in July 2000 it was awarded major project facilitation status by the Australian government.

FLOATING LIQUIFIED NATURAL GAS TECHNOLOGY

In 1997, Shell began feasibility studies on a new method of producing natural gas. The principle is that a production plant would be on a floating barge which can go to a gas field and process the gas at the field rather than transporting it via expensive pipelines to an onshore plant. The barge would be capable of offloading the gas directly onto ships, negating the need for pipelines and onshore plants. The reduced cost implications of this method would make it far more cost effective to reach smaller and more remote gas reserves. The floating plant could also be used at different locations during its working life. It is believed that this technology could start production in 2006.

LEAD CONTRACTORS

Phillips Petroleum has a two-phase project beginning with a $1.5 billion gas recycle project. In late 2003, the project is expected to begin producing and processing the gas, separating and selling the liquids, and re-injecting the gas back into the reservoir. Full commercial production is expected to begin in early 2004. The second phase will be a gas project and will proceed as gas markets are developed. The company is negotiating an agreement to build a sub-sea pipeline from the Bayu-Undan project to Darwin, Australia. All potential gas markets, including LNG and domestic Australian markets, are being pursued.

Australian energy company Woodside will be building a $1.5 billion methanol/syngas plant near Darwin proposed by Methanex Corporation, the world's biggest producer and marketer of methanol.

Osaka gas has signed an agreement with Woodside Energy and Shell Development for an acquisition of 10% of the concession rights in the two gas fields in Australia. Osaka Gas has maintained a cooperative relationship with the two companies to date and it believes that the company's expertise in LNG transport and marketing can be combined with the exploration and production know-how of the two Australian producers for mutual benefits.

BENEFITS OF THE SUNRISE GAS PROJECT

Australia stands to benefit from a new long term natural gas supply, employment growth, new export industries producing LNG, methanol and other derivatives from new generation plant and potential spin-off development, and increases in taxation revenue for the Northern Territory and Australian governments.

East Timor stands to benefit from taxation revenue, education, training and employment opportunities.

Other benefits will be derived from more efficient industries, increased use of natural gas in place of less efficient fuels and reduced greenhouse gas emission rates, the extension of reliable gas supplies to underpin the national gas grid and potentially improve supply security for customers in Queensland, New South Wales and South Australia.