Previously, East Timor officials had insisted that Sunrise gas must be piped across the 3000 metre-deep Timor Trough for processing in East Timor.

Woodside, the operator in the Greater Sunrise joint venture, maintained the location of the processing facility was a commercial decision that should not be covered in formal government-to-government agreements.

If the Greater Sunrise project goes ahead, its gas will be probably be processed at a plant next to ConocoPhillips's facility being built at Wickham Point in Darwin.

But Sunrise is not likely to be developed this decade.

Woodside has made it clear that it is prioritising the development of a new Browse Basin hub, the fifth North West Shelf liquified natural gas train and the giant Pluto gas discovery, which could be combined with Chevron's Wheatstone find to feed a sixth NWS train.

Meanwhile, Woodside chief executive Don Voelte has written to East Timor prime minister Mari Alkatiri, congratulating him on setting up a fund to ensure prudent and transparent management of petroleum revenues.

East Timor's parliament last week unanimously supported the government’s Petroleum Fund Law.

This law creates a permanent fund designed to make the country’s petroleum revenues last for generations. It is based on Norway’s fund but with additional transparency and accountability features, according to the East Timorese government.

“It is a magnificent achievement,” Voelte wrote, adding that the plan showed Alkatiri was “committed to making Timor-Leste [East Timor] a model for the world.”

This initiative will give “tremendous encouragement” to the entire hydrocarbon industry as it showed the tiny country was determined to develop its resources in an open and transparent manner, Voelte said.

“Timor-Leste is the kind of country Woodside wants to do business with, and I look forward to meeting you in the next few weeks to take that forward,” Voelte told Alkatiri.

In April, Voelte addressed the Australian Petroleum Production and Exploration Association conference in Perth on the subject of “Why transparency is good business.”

In that speech he made particular mention of East Timor’s petroleum fund.

“The government will restrict fund spending to the income generated by it,” Voelte said.

“This would be used to meet the difference between general government spending and income from non-petroleum revenues. The objective of the fund is to maintain the real value of petroleum wealth, including estimated revenues from petroleum still in the ground.

“The Timor-Leste Government plans to publish what goes into the fund and publish what is taken out. Its accounts will be independently audited.

“While our Sunrise project in the Timor Sea remains stalled, as the Timor-Leste and Australian governments continue their boundary discussions, we feel assured that public revenues which may flow from any development will be properly and prudently managed.”

Voelte said Woodside was also keen to see principles of transparency applied in its other projects in developing countries, including its Mauritanian operations.

“Next year, Woodside’s first operated overseas project will come into production, our Chinguetti oil project off Mauritania,” he told the conference.

“We see our ability to implement a meaningful payment disclosure model for Chinguetti as an important issue for Woodside’s reputation as an international operator.

“Payment transparency has been raised by Woodside senior management with the Mauritanian Government at several levels. Our message has been well received, and we are working on plans to implement a framework for reporting.”

Woodside was also working with the Mauritanian Government to clarify the confidentiality obligations of the production sharing contract, according to Voelte. The company has proposed a disclosure model which identifies total production volumes, entitlement to production volumes, direct taxes paid to the government and other material payments.

“We have proposed that we would disclose the reason for making these payments, the amount, and the identity of the recipient body,” he said.

“The model is based on the fundamental principles of transparency, is fit for purpose and is easy to implement and administer. The Mauritanian disclosure model will be the basis of Woodside’s approach to payment transparency across a range of jurisdictions.

“The model provides us with a framework, rather than a prescriptive set of rules to allow us to work with host governments to provide easily accessible and understood information about the revenue streams generated through the commercialisation of petroleum resources.”

Woodside is the operator of the Greater Sunrise field, which is located in part of the Joint Petroleum Development Area in the Timor Sea. This field, which is yet to be developed, is a world-class resource with 7.7 trillion feet of natural gas and 300 million barrels of condensate and LPG.