Matt Fox, the company’s executive vice president Strategy, Exploration and Technology, said the deal was mutually beneficial.
“ConocoPhillips has a long history in Timor-Leste through our operated interest in the Bayu-Undan field. Although we differ with the government on its proposed development plan for Sunrise, we recognize the importance of the field to the nation of Timor-Leste, and the sale of our interest to the government gives them a working interest in this important development.”
The transaction is expected to close during 1Q 2019.
Wood Mackenzie analyst David Low commented: “We believe the likely forward plan to monetize Sunrise is now through an onshore LNG development in Timor-Leste. This would require:
- Construction of a new liquefaction plant and associated infrastructure
- An FPSO to process and handle the condensate
- Construction of a pipeline connecting the FPSO to shore.
“Timor-Leste authorities are determined to harness the economics benefits of an onshore development. The Timor-Leste government are also pursuing the development of Sunrise to replace declining revenues from the mature [offshore]Bayu Undan field.
“We believe the key onshore project risk is the construction of a greenfield LNG project in a country that has historically lacked large-scale infrastructure projects. The next step is for the project to put forward a viable development plan that all the project participants would be willing and happy to commit to.”