Dili, June 13, 2025 (Lusa) - The government of Timor-Leste and Australia’s Santos met to discuss the future of the Bayu-Undan gas field after the company notified the authorities that production had ended, the government said on Friday.
At the meeting, held on Tuesday and led by the Minister of Petroleum and Mineral Resources Francisco Monteiro, “participants discussed how to reconcile the remaining extraction of natural gas with the conversion of the field for carbon capture and storage purposes, and they assessed possible synergies with other fields, such as Chuditch,” according to information available on the government’s official website.
The Bayu-Undan field began production in 2004 and contributed approximately $25 billion (equivalent to €22.3 billion) to the state coffers over a 20-year period.
The Australian company Santos is the operator of Bayu-Undan (with 36.5%) in a consortium that includes SK E&S (with 21%), INPEX (with 9.6%), Eni (with 9.2%), Tokyo Timor Sea Resource (with 7.7%) and also Timor GAP, a Timorese oil company, which recently acquired a 16% stake.
The Timorese authorities now intend to transform Bayu-Udan into a regional underground carbon storage centre with a capacity of 10 million tonnes per year.
At the same time, the government also intends to explore the remaining gas reserves to channel it to Timor-Leste via the Chuditch field.
According to the Timorese government, the closure of Bayu-Undan production “marks a new beginning.” The government has launched a new phase, “based on a plan to reconvert and upgrade existing infrastructure alongside the development of other strategic solutions, such as the exploration of the Chuditch and Greater Sunrise fields,” mineral prospecting and the implementation of the Tasi Mane project.
‘The conversion of Bayu-Undan, together with the Tasi Mane project, the development of Greater Sunrise, the construction of new gas pipelines and the focus on the downstream industry, reflects a modern energy policy that is in line with the challenges of the future,’ explained the Timorese government.
Located 150 km from Timor-Leste and 450 km from Darwin (northern Australia), the Greater Sunrise project has reached a negotiation standstill, with Dili advocating the construction of a gas pipeline to the south of the country and Woodside, the consortium’s second largest partner, leaning towards a connection to the existing unit in Darwin.
The consortium consists of Timor Gap (56.56%), operator Woodside Energy (33.44%) and Osaca Gás (10.00%).
The Timorese authorities consider the connection of the gas pipeline to the south of Timor-Leste strategic for the country’s economic growth.
The impasse led the joint venture to commission a conceptual study by British company Wood, which confirmed the feasibility of developing Greater Sunrise in Timor-Leste.
‘The Liquefied Natural Gas option in Timor-Leste stands out for its lower operating costs and, by allowing better overall direct and indirect returns for Timor-Leste, will have a major socio-economic impact on the country,’ said the Timorese government.
The government also pointed out that Greater Sunrise in Timor-Leste, according to the study, could have a “greater positive impact on gross domestic product and job creation, while also offering the highest returns for the development consortium” of that gas field.
The Tasi Mane project aims to transform the country’s south coast into an integrated oil and natural gas development corridor, featuring the construction of a logistics base in Suai, a refinery and petrochemical complex in Natarbora, as well as a Liquefied Natural Gas (LNG) plant and supporting infrastructure.
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