East Timor wants gas pipeline and plans to build supply base

2 July 2012

The East Timor government believes that the choice of the south coast of the country for the new gas pipeline running from the Greater Sunrise field, which it shares with Australia, will prevail.

The Secretary of State for Natural Resources, Alfredo Pires told Macauhub that that, “several feasibility studies have been carried out,” and that, “the results show that the gas pipeline to East Timor costs US$1 billion and to Australia it costs US$1.8 billion.”

The aim is also to build a 1000-hectare supply base in the south of the country, which, “in ten or 15 years will create 40,000 jobs.”

“Australia already has a gas pipeline and it makes sense to us and is fair that now we should get this one. Nobody would lose money. We are discussing this matter and carrying out comparative studies,” said Pires.

The Secretary of State gave assurances that the issues raised by Australia, which could be a problem for the East Timor option, have already been refuted by the studies put forward by the Government.

In terms of distance, Pires said that the pipeline would extend over 150 kilometres to the East Timor coast [230 if more geologically troublesome areas are avoided] and over 530 kilometres to the Australian coast.

“We have the south coast mapped out and we have chosen a route for the gas pipeline. We have depths of 2,800 metres and the maximum could be 3,300 metres, with current technologies. We have done those feasibility studies,” the Secretary of State said.

In May at the celebration of 10 years of the country’s independence the Timorese government decided to present a small sample of the pipeline that it hopes to bring to the south of the country – and it did so in front of the Government Palace.

“We brought a small piece and said ‘it’s here’ to confirm our position, show the technology and also to show the people what we are talking about. We have always been under pressure and now it is our turn to put pressure on the other side. We’re ready.”

According to Pires this is the “ideal investment,” to apply the capital accumulated in the Oil Fund – the balance of the fund in April of this year was US$10.54 billion.

“An investment in the gas pipeline has a fixed return of 7 to 8 percent over 40 years. What I can say is that the option of East Timor is technically and commercially viable. We are in discussions but for us there is no other way,” he noted.

One of Timor’s big projects for the next few years is construction of a base to support energy exploration on the south coast of the country, in the area known as Tacimane.

The supply base – a model used in other oil producing countries – would be in the districts of Suai, Betano and Beaco.

“Suai will be the logistical support base for oil activities, Betano will be for the petrochemical industry, Viqueque and Beaco is where the Greater Sunrise gas pipeline will be. These are three points along a distance of 160 kilometres,” Pires explained.

“For the supply base, Parliament ahs already approved US$100 million and US$45 million for the highway. We are now talking with the population, and we are buying the land as needed,” Pires added. (macauhub)