THE WALL STREET JOURNAL: Will Timor Gas Project Resurface?: "Woodside operates and owns 33.4% of Sunrise, situated 150 kilometers south of East Timor. Its partners are ConocoPhillips with 30%, Royal Dutch/Shell Group PLC with 26.6% and Osaka Gas Co. with 10%.": Friday 13 January 2006

SYDNEY – Australia and East Timor agreed Thursday to equally share revenue from the Greater Sunrise gas project in the Timor Sea, in a deal they hope will give the green light to the project.

The accord was signed by Australia's Foreign Minister Alexander Downer and his East Timorese counterpart Jose Ramos-Horta in Sydney, with their respective prime ministers, John Howard and Mari Alkatiri, also present.

Woodside Petroleum Ltd. and its partners in the US$5 billion Sunrise project -- regarded as the richest prize in the Timor Sea -- are still to decide whether they will dust off the venture, which was put on hold after a previous revenue-sharing deal favoring Australia wasn't put to East Timor's Parliament.

The Sunrise project is owned by a consortium of U.S., European, Japanese and Australian companies. The Sunrise partners are now waiting for the treaty to go through both countries' parliaments and also want an agreement with East Timor on royalties before considering whether to go ahead with the massive project.

East Timor, which won independence from Indonesia in 1999, is one of Asia's poorest countries.

Greater Sunrise includes the Sunrise and Troubadour fields, which hold about eight trillion cubic feet of gas and about 300 million barrels of oil, valued at as much as US$40 billion. The partners have spent A$250 million on studies to develop the project.

Woodside operates and owns 33.4% of Sunrise, situated 150 kilometers south of East Timor. Its partners are ConocoPhillips with 30%, Royal Dutch/Shell Group PLC with 26.6% and Osaka Gas Co. with 10%.

The treaty increases East Timor's share of project revenue to US$10 billion during the life of Sunrise, from about US$6 billion before, Australian Foreign Minister Alexander Downer said.

Australia will make about the same amount from Sunrise revenue.

Mr. Alkatiri said he is "quite confident" East Timor's Parliament will ratify the treaty.

This agreement alone won't speed development of the project, a Woodside spokesman said, adding that the company hasn't seen the agreement. "We need to see the treaty ratified, then a fiscal-stability agreement with East Timor," the spokesman said.

If those conditions are satisfied, approval of the project would depend on whether and at what price Sunrise can sell the gas and how much the fields will cost to develop.

Write to Matt Chambers at matt.chambers@wsj.com