The Joint Petroleum Development Area (JPDA) and the Greater Sunrise gas and condensate fields are areas of the Timor Sea in which Australia and Timor-Leste work together to facilitate the development of shared petroleum resources. The Timor Sea Treaty (TST) and the International Unitisation Agreement (IUA) provide the overarching governance framework for the JPDA and the Greater Sunrise fields.
Australia-Timor-Leste maritime boundaries
Australia and Timor-Leste have committed to negotiate permanent maritime boundaries under the auspices of the Conciliation Commission constituted under the United Nations Convention on the Law of the Sea as part of an integrated package of measures agreed by both countries.
Pending the conclusion of a permanent maritime boundary the Parties have agreed that the TST and the regulatory framework that it established for the joint management and development of hydrocarbon resources within the JPDA continues to apply.
The Timor Sea Treaty and the Joint Petroleum Development Area
The TST between Timor-Leste and Australia came into force on 2 April 2003 and established the JPDA. The TST also establishes:
- revenue from petroleum production in the JPDA is split between Timor-Leste and Australia on a 90:10 basis;
- the Joint Commission, which establishes policies and regulations for petroleum activities in the JPDA, and oversee the work of the Designated Authority. The Joint Commission is comprised of a minimum of one Australian representative, and two Timorese representatives; and
- day-to-day regulation of the JPDA is managed by the Designated Authority, which is currently the Timor-Leste offshore regulator, the Autoridade Nacional do Petróleo e Minerais (ANPM). The ANPM regulates petroleum operations in the JPDA on behalf of both countries.
Petroleum Operations in the Joint Petroleum Development Area
At present, there is only one field operating in the JPDA. ConocoPhillips (57 per cent) operates the Bayu-Undan gas and condensate field in a Joint Venture together with Eni (11 per cent), Santos (11 per cent), INPEX (11 per cent), and Tokyo Timor Sea Resources Pty (9 per cent). Production from the Bayu-Undan field began in 2005.
The Kitan oil field ceased production in December 2015. The Kitan field was operated by Eni (40 per cent) and Joint Venture partners INPEX Timor Sea Ltd (35 per cent) and Talisman Resources Pty Ltd (25 per cent).
Further information on developments within the JPDA, including revenue received by both Timor-Leste and Australia, is available from the ANPM website.
The Greater Sunrise gas and condensate fields
The Greater Sunrise fields overlap a combined area of exclusive Australian jurisdiction (79.9 per cent of the fields) and the JPDA (20.1 per cent of the fields).
It is estimated that the fields contain 5.1 trillion cubic feet of natural gas and 226 million barrels of condensate.
Under Article 9 of the TST, Timor-Leste and Australia agreed that any deposit that extends beyond the boundary of the JPDA would be developed as a single entity for management and development purposes, ensuring that neither country can develop overlapping fields unilaterally.
The Joint Venture for Greater Sunrise is led by Woodside Petroleum Limited (operator and 33 per cent shareholder), and includes Royal Dutch Shell (27 per cent), ConocoPhillips (30 per cent) and Osaka Gas (10 per cent). The joint venture holds two retention leases for the Australian portion of the fields, and two production sharing contracts for the JPDA portion of the fields, giving it exclusive rights to develop the Greater Sunrise fields.
In addition to the TST, the shared governance of the Greater Sunrise fields between Australia and Timor-Leste is determined by the IUA.
The International Unitisation Agreement
The IUA between Timor-Leste and Australia came into force on 23 February 2007, in accordance with Article 9 of the TST. The IUA established:
- a Sunrise Commission to provide strategic direction and facilitate the approvals processes of the Australian and JPDA regulators;
- the arrangements relating to day-to-day administration of the Greater Sunrise fields; and
- criteria for approval of a Field Development Plan.
The IUA stipulates that Greater Sunrise will be developed by a joint venture. The joint venture is required to submit a Field Development Plan to the Regulatory Authorities before the area may be developed.
NOPSEMA and NOPTA regulate 79.9 per cent of the fields on behalf of Australia. The ANPM regulate the 20.1 per cent of the fields within the JPDA on behalf of both Australia and Timor-Leste.
Both regulators must approve any proposed Field Development Plan. Neither country can unilaterally develop the field.