Australia's Queensland state eyes Timor Sea gas
17:42, Wednesday, 23 May 2001
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Queensland Government is playing East Timor against PNG gas.
On the news Queensland Treasurer Terry Mackenroth was non-committal on the PNG pipeline.
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MELBOURNE, May 23 (Reuters) - Queensland state Premier Peter Beattie said on Wednesday he was meeting with Timor Sea petroleum field developers on Thursday over the possible supply of gas from the offshore fields into the state.
Beattie said he would meet company representatives to discuss the status of the Bayu-Undan and Greater Sunrise Timor Sea projects.
The Queensland government has been a strong supporter of the US$3.5 billion Papua New Guinea to Queensland gas pipeline, often seen as a rival to the Timor Sea, which was planned to come on stream in 2001 but is now expected no earlier than 2005.
Beattie said the meeting with the Timor Sea gas developers was not a vote against the PNG project.
"No-one should see this as being a negative for PNG. I think PNG is a major player but we want competition and if we get Timor Sea and PNG that is terrific," he told reporters. "I think in the end both will come, it is a case of timing."
Beattie said he hoped to see a pipeline built from the Northern Territory to Mt Isa and across to Townsville that would link into a national pipeline grid which could access a range of supply sources.
The Queensland Government has also said its energy retailers ENERGEX and Ergon Energy will step back from a wholesale gas aggregator role in securing customers for the PNG pipeline.
"We think at the end of the day for ENERGEX and Ergon that is not really their role and it is better for PNG to deal directly with their customers," Beattie said.
"That is not be seen in any way as a reduction in our enthusiasm for PNG or Timor."
Queensland Treasurer Terry Mackenroth said on Monday that a the government would look at a range of gas sources for the baseload power station it planned to build in Townsville, which has been considered a likely PNG gas customer.
"Ideally the new power station would be commissioned by the end of 2003, but this date may be extended up to 2005 depending on market conditions and the merits of individual projects," he said.
Timor Sea gas proponents hope to bring supplies onshore at Darwin from 2004, if they can secure customers and finalise regulatory and political issues, including a new treaty for the petroleum revenue split between Australia and East Timor.
Timor Sea Bayu-Undan gas is being marketing in Australia by Phillips Petroleum Co in alliance with Epic Energy, while Greater Sunrise gas is marketed by field operator Woodside Petroleum Ltd and Shell.
A agreement to jointly develop offshore pipeline infrastructure was reached between the projects earlier this year but they are competing for domestic market customers.
Phillips and Epic, majority owned by El Paso Energy Corp and Dominion Resources Inc have not actively pursued customers in coastal Queensland due to the PNG plan.
But Shell and Woodside have taken a more active interest in the potential coastal market.
"We are trying to see if there is the possibility of finding customers down the coast, but it is early days at the moment," a Shell spokesman said.
Woodside shares closed down 19 cents at A$15.01 while the broader market was down 0.29 percent.
(c) Reuters Limited 2001
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