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Reuters: Shell says heartened by Australia, E.Timor gas deal: “An agreement between Australia and East Timor on sharing revenues from the Greater Sunrise gas field was encouraging for the project's development, Royal Dutch/Shell's Australian chairman said on Wednesday.”: "Shell's Australian unit posted a 28 percent decline in annual profit before interest and tax to A$587 million ($440 million) in calendar 2004...": Wednesday December 7 2005

 

MELBOURNE, Dec 7 (Reuters) - An agreement between Australia and East Timor on sharing revenues from the Greater Sunrise gas field was encouraging for the project's development, Royal Dutch/Shell's Australian chairman said on Wednesday.

Shell holds a 26.56 percent stake in the Timor Sea gas field, but a $5 billion development has been delayed by a dispute over the division of revenues between Australia and East Timor.

 

An agreement announced at the start of this month is due to be signed by the prime ministers of both countries in mid-January.

 

Tim Warren, Chairman of the Shell Companies in Australia, said the project still hinged on resolving regulatory and fiscal issues, but remained a priority amid strong demand for liquefied natural gas from a range of potential projects.

 

"I have no doubt we can commercialise everything we have got providing we can get moving soon enough," he told a media lunch.

 

Greater Sunrise is operated by Woodside Petroleum Ltd. . Other stakeholders are ConocoPhillips and Osaka Gas Co Ltd.    

 

Warren said recent LNG price rises had slowed China's emergence as a major buyer despite its determination to increase the share of gas in its energy mix.

 

"What we are seeing at the moment is how dynamic change in the price in LNG has actually caught the Chinese a little bit off guard," he said.

 

Suppliers were ready to sell additional volumes to China, at the right price, and were closely watching developments, he later told reporters.

 

"China moves at its own pace. When they want to, they move incredibly fast," he said.

 

Shell's Australian unit posted a 28 percent decline in annual profit before interest and tax to A$587 million ($440 million) in calendar 2004, as its refineries were affected by shutdowns.

 

Retail sales were boosted last year by an alliance with Coles Myer Ltd. , which Warren said was "still working marvels" as the company expected a stronger 2005.

 

"We are already into December and I believe we are going to have a sterling year this year," he said.

 

Warren, who will next year be succeeded as chairman of the Australian unit by Russell Caplan, said the company aimed to build its Australian LNG portfolio by stepping up exploration. ($1=A$1.33)  

 

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