Santos has confirmed that Bayu-Undan gas field production ceased in June 2025. The production stoppage of the field contributes about 85% of Timor-Leste’s budget while its Sunrise gas development project has also been stalled for years.
Author:
Mostafa Sharif
Santos has confirmed that Bayu-Undan gas field production ceased in June 2025. The production stoppage of the field, which contributes about 85% of Timor-Leste’s budget while its Sunrise gas development project has also been stalled for years, will cause a big challenge for the poor country’s government that is struggling to find new financial sources to run the country.
Development of the Sunrise gas field at the earliest time is crucial for Timor as it has lost its main source of income generated from the Bayu-Undan gas field and 3.7 MMT/Y Darwin LNG plant in Australia.
A recently released Wood-led study finds that the Sunrise LNG project could be feasibly constructed on Timor-Leste’s southern coastline, instead of its operator Woodside’s initial plan to build the LNG processing plant at Darwin in Australia.
According to the Global LNG Database®, the Sunrise Joint Venture (SJV)’s shareholders are Timor-Leste’s government (Timor GAP) 56.56%, Woodside Energy (operator) 33.44%, Osaka Gas 10.00%.
Building the Sunrise gas-to-LNG project would be the most advantageous for Timor-Leste, “guaranteeing significant economic and social benefits,” the young island nation’s government has said, adding that processing the gas on its coast would provide lower operating costs, while “enabling better overall direct and indirect returns” for the country and “better direct upstream returns to Australia.”
However, Woodside is reluctant to take decisive action to develop Sunrise because it needs to secure adequate financial resources to invest multi-billion dollars in the development of its preferred mega projects in Louisiana, USA and then Browse in Australia.
Market insiders suggest that Timor-Leste may consider replacing Woodside with another operator such as a Chinese company, while the Australian company has consistently insisted that reaching an agreement on a new Sunrise development PSC is a prerequisite for any development activity.
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In other development, Santos has said that discussions with Timor-Leste and Australian governments are continuing to progress the proposed Bayu-Undan Carbon Capture and Storage project and look at opportunities to process third party gas through Bayu-Undan infrastructure.
“Discussions with a focus on the regulatory and fiscal frameworks, approvals, government-to-government agreements, and commercial agreements to progress towards FID readiness.”
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Source(s)
Global LNG Database®, Author: Mostafa Sharif
