.
Matthew Stevens - The Australian - March 12, 2011
A DIPLOMATIC darkness continues to set firm on Woodside Petroleum's plans to invest upwards of $14 billion on the novel Greater Sunrise liquefied natural gas project, with East Timor this week threatening to walk away from the international treaty that apportions sovereignty over the petroleum territory it shares with Australia.
On the same day the market got first sight of Woodside's Tokyo-option for progress on another of its contentious projects, the Browse development on the North West Shelf of WA, The Australian reported that East Timor would abandon the royalty sharing treaty with Australia rather than accept Woodside's proposal to build a floating LNG processing plant on top of Greater Sunrise.
The treaty in question is called CMATS (or the Treaty on Certain Maritime Arrangements in the Timor Sea . . . no I am not kidding!) and it sets the rules by which development of Greater Sunrise can proceed and enshrines a 50-50 split between Australia and East Timor on royalty flows.
Under the terms of CMATS, East Timor can conclude the treaty as early as February 2013. And that, according to our near neighbour's chief negotiator, Francisco da Costa Monteiro, is exactly what it will do if Woodside continues to ignore Dili's development preferences.
The reality here is that Monteiro and just about anyone else involved in East Timor's Greater Sunrise negotiations have seen and heard all they want to from Woodside's current boss, Don Voelte.
They know Voelte is leaving and they are patently attempting to filibuster the Greater Sunrise process in the hope that his replacement might be more amenable to their ideas of the way forward for the project and, barring that, that they might be able to lure the federal government into more active engagement in the current dispute.
The issue before Woodside and our federal government is that East Timor wants the Greater Sunrise gas landed and processed on its south coast at a spot called Beacu.
Woodside says that option would add at least $5bn to the cost of a project and it would increase the overall project risk because it would require the construction of a pipeline across the Timor Trench and the construction and operation of an LNG facility in a country poor in both infrastructure and skilled labour.
The federal government, at least so far, is sticking to its mantra, which is that the operator of the Greater Sunrise lease, Woodside, should be free to proceed with the most commercially sensible option, as proscribed by the CMATS arrangements.
According to Woodside, landing gas in East Timor would sit at the very edge of pipeline technology both in its construction and operation. But East Timor is insisting that it must be done.
The root of the problem here is essentially topographical. The Greater Sunrise fields were discovered in the Timor Sea by Woodside in 1974 and within 12 months Indonesia had invaded East Timor.
Two subsequent agreements over the sovereignty of the waters of the Timor Sea, the first with Indonesia, the second with East Timor, have left Greater Sunrise straddling Australian territory and what is now called the Joint Petroleum Development Area.
The JPDA was affirmed in 2002 by the Timor Sea Treaty and its effect is that East Timor gets 90 per cent of any royalties that flow from petroleum production in the zone. But the real irritation right now is that the combination of the CMATS and JPDA treaties leaves East Timor with a call over Woodside's options that is quite disproportionate to its actual entitlement to the Greater Sunrise gas.
In the end, only about 20 per cent of the gas sits within the JPDA. The rest is Australian. And the distinction between what gas sits where might well become important as this dispute develops.
Speaking recently about Greater Sunrise, Woodside boss Don Voelte said: "If we run into a little bit of a brick wall here and we can't get around it or go through it, well, we'll go over it." And one way over the wall might be to extract Australia's share of the Greater Sunrise gas and leave East Timor to its own devices. And, to that end, the suspension of the CMATS treaty might come as a blessing in disguise.
Fraser's potash play
AS an investment banker, Chris Fraser worked both sides of the great Pilbara divide, working with Fortescue on the now legendary $2.04 billion debt raising that bought it a real future in iron ore and a year later mulling through merger and acquisitions strategies for BHP Billiton.
So, when Fraser quit Citi two years ago to pursue an independent business life as a miner, he walked away with a big idea extracted from each miner.
From his work with BHP he divined his commodity of choice and from Fortescue he adapted a new business model.
This week Fraser completed a pound stg. 20 million ($32m) capital raising that he expects will see Sirius Minerals transformed into an Australian based, British listed operator of a potash mine just south of picturesque Whitby on the coast of North Yorkshire.
Fraser reckons he has been looking for a pathway to potash since he was introduced to the fertiliser at a series of strategy sessions at BHP in London in 2007.
"Citi were working with BHP's key strategy guy, Alberto Calderon, on complete global M&A review and potash and PSC (Potash of Saskatchewan) just kept floating to the top of the lists."
(BHP eventually made a $40bn bid for Potash Corp in 2010, only to be blocked from its pursuit by the Canadian government on national interest grounds.)
"Then when I set up my own consultancy business two years ago, I set out to have a really good look at how you might get into potash at the bottom floor," Fraser told me yesterday. "I looked around the sector and about a year ago a geologist came to me and asked, 'Do you know there is a potash mine in the UK?' The thing about potash is that it tends to occur fairly broadly. So we looked it up. It is called the Boulby Mine and it is in North Yorkshire. And then we started our own journey.
"We hired the two best people in the UK, including those that actually commissioned Boulby. And then went out and gathered data and then set about collecting mining rights by stealth to ensure that no one else would run up against us." These days, in his more buoyant moments, Fraser expresses hopes that he can become the Fortescue of potash. And you only have to look at his board to see why he might be liking his chances of emulating a success that he helped generate at Citi.
After all, Sirius has both a former and a current Fortescue executive on its board. The new force in iron ore, former CFO Chris Catlow, is the chairman of Sirius, while current Fortescue executive director Russell Scrimshaw is a non-executive director of the potash prospector. Both are major shareholders, with Catlow owning 11 per cent of the company and the more recently deployed Scrimshaw 1.4 per cent.
Sirius was set up by Catlow as a vehicle to look for, among other things, potash in Australia and North Dakota. Then along came Fraser and his North Yorkshire option. That project was delivered into Sirius, with Fraser emerging as the senior shareholder of the company, with nearly 13 per cent of the business.
Like Fortescue, Sirius has made good use of exploration work carried out by different arms of what has subsequently become Rio Tinto. Fortescue's initial forays into the Pilbara were guided by CRA's work on tenements that were subsequently surrendered, while the York sulphate of potash deposit that Fraser wants to tap was initially identified in the 1970s by RTZ.
According to Fraser, this particular brand of potash attracts a healthy premium over the more chlorine-heavy muriates of potash that is produced by the Canadian producers that so dominate the global market. Fraser reckons his chunk of Yorkshire contains one of the biggest deposits of sulphate of potash in the world. This might just be a story to watch.
.
Matthew Stevens - The Australian - March 12, 2011
A DIPLOMATIC darkness continues to set firm on Woodside Petroleum's plans to invest upwards of $14 billion on the novel Greater Sunrise liquefied natural gas project, with East Timor this week threatening to walk away from the international treaty that apportions sovereignty over the petroleum territory it shares with Australia.
On the same day the market got first sight of Woodside's Tokyo-option for progress on another of its contentious projects, the Browse development on the North West Shelf of WA, The Australian reported that East Timor would abandon the royalty sharing treaty with Australia rather than accept Woodside's proposal to build a floating LNG processing plant on top of Greater Sunrise.
The treaty in question is called CMATS (or the Treaty on Certain Maritime Arrangements in the Timor Sea . . . no I am not kidding!) and it sets the rules by which development of Greater Sunrise can proceed and enshrines a 50-50 split between Australia and East Timor on royalty flows.
Under the terms of CMATS, East Timor can conclude the treaty as early as February 2013. And that, according to our near neighbour's chief negotiator, Francisco da Costa Monteiro, is exactly what it will do if Woodside continues to ignore Dili's development preferences.
The reality here is that Monteiro and just about anyone else involved in East Timor's Greater Sunrise negotiations have seen and heard all they want to from Woodside's current boss, Don Voelte.
They know Voelte is leaving and they are patently attempting to filibuster the Greater Sunrise process in the hope that his replacement might be more amenable to their ideas of the way forward for the project and, barring that, that they might be able to lure the federal government into more active engagement in the current dispute.
The issue before Woodside and our federal government is that East Timor wants the Greater Sunrise gas landed and processed on its south coast at a spot called Beacu.
Woodside says that option would add at least $5bn to the cost of a project and it would increase the overall project risk because it would require the construction of a pipeline across the Timor Trench and the construction and operation of an LNG facility in a country poor in both infrastructure and skilled labour.
The federal government, at least so far, is sticking to its mantra, which is that the operator of the Greater Sunrise lease, Woodside, should be free to proceed with the most commercially sensible option, as proscribed by the CMATS arrangements.
According to Woodside, landing gas in East Timor would sit at the very edge of pipeline technology both in its construction and operation. But East Timor is insisting that it must be done.
The root of the problem here is essentially topographical. The Greater Sunrise fields were discovered in the Timor Sea by Woodside in 1974 and within 12 months Indonesia had invaded East Timor.
Two subsequent agreements over the sovereignty of the waters of the Timor Sea, the first with Indonesia, the second with East Timor, have left Greater Sunrise straddling Australian territory and what is now called the Joint Petroleum Development Area.
The JPDA was affirmed in 2002 by the Timor Sea Treaty and its effect is that East Timor gets 90 per cent of any royalties that flow from petroleum production in the zone. But the real irritation right now is that the combination of the CMATS and JPDA treaties leaves East Timor with a call over Woodside's options that is quite disproportionate to its actual entitlement to the Greater Sunrise gas.
In the end, only about 20 per cent of the gas sits within the JPDA. The rest is Australian. And the distinction between what gas sits where might well become important as this dispute develops.
Speaking recently about Greater Sunrise, Woodside boss Don Voelte said: "If we run into a little bit of a brick wall here and we can't get around it or go through it, well, we'll go over it." And one way over the wall might be to extract Australia's share of the Greater Sunrise gas and leave East Timor to its own devices. And, to that end, the suspension of the CMATS treaty might come as a blessing in disguise.
Fraser's potash play
AS an investment banker, Chris Fraser worked both sides of the great Pilbara divide, working with Fortescue on the now legendary $2.04 billion debt raising that bought it a real future in iron ore and a year later mulling through merger and acquisitions strategies for BHP Billiton.
So, when Fraser quit Citi two years ago to pursue an independent business life as a miner, he walked away with a big idea extracted from each miner.
From his work with BHP he divined his commodity of choice and from Fortescue he adapted a new business model.
This week Fraser completed a pound stg. 20 million ($32m) capital raising that he expects will see Sirius Minerals transformed into an Australian based, British listed operator of a potash mine just south of picturesque Whitby on the coast of North Yorkshire.
Fraser reckons he has been looking for a pathway to potash since he was introduced to the fertiliser at a series of strategy sessions at BHP in London in 2007.
"Citi were working with BHP's key strategy guy, Alberto Calderon, on complete global M&A review and potash and PSC (Potash of Saskatchewan) just kept floating to the top of the lists."
(BHP eventually made a $40bn bid for Potash Corp in 2010, only to be blocked from its pursuit by the Canadian government on national interest grounds.)
"Then when I set up my own consultancy business two years ago, I set out to have a really good look at how you might get into potash at the bottom floor," Fraser told me yesterday. "I looked around the sector and about a year ago a geologist came to me and asked, 'Do you know there is a potash mine in the UK?' The thing about potash is that it tends to occur fairly broadly. So we looked it up. It is called the Boulby Mine and it is in North Yorkshire. And then we started our own journey.
"We hired the two best people in the UK, including those that actually commissioned Boulby. And then went out and gathered data and then set about collecting mining rights by stealth to ensure that no one else would run up against us." These days, in his more buoyant moments, Fraser expresses hopes that he can become the Fortescue of potash. And you only have to look at his board to see why he might be liking his chances of emulating a success that he helped generate at Citi.
After all, Sirius has both a former and a current Fortescue executive on its board. The new force in iron ore, former CFO Chris Catlow, is the chairman of Sirius, while current Fortescue executive director Russell Scrimshaw is a non-executive director of the potash prospector. Both are major shareholders, with Catlow owning 11 per cent of the company and the more recently deployed Scrimshaw 1.4 per cent.
Sirius was set up by Catlow as a vehicle to look for, among other things, potash in Australia and North Dakota. Then along came Fraser and his North Yorkshire option. That project was delivered into Sirius, with Fraser emerging as the senior shareholder of the company, with nearly 13 per cent of the business.
Like Fortescue, Sirius has made good use of exploration work carried out by different arms of what has subsequently become Rio Tinto. Fortescue's initial forays into the Pilbara were guided by CRA's work on tenements that were subsequently surrendered, while the York sulphate of potash deposit that Fraser wants to tap was initially identified in the 1970s by RTZ.
According to Fraser, this particular brand of potash attracts a healthy premium over the more chlorine-heavy muriates of potash that is produced by the Canadian producers that so dominate the global market. Fraser reckons his chunk of Yorkshire contains one of the biggest deposits of sulphate of potash in the world. This might just be a story to watch.
.
1 comentários:
Woodside boss Don Voelte said: "If we run into a little bit of a brick wall here and we can't get around it or go through it, well, we'll go over it." And one way over the wall might be to extract Australia's share of the Greater Sunrise gas and leave East Timor to its own devices. And, to that end, the suspension of the CMATS treaty might come as a blessing in disguise.
ONLY ILLTERATES THAT BABBLE OUT THIS STATEMENT !!!
Enviar um comentário