Deed of agreement signed by State and Federal government.
|Date:||Thursday, 23 July 2015|
The agreement is the first of this kind and provides certainty for the joint venture partners.
?Federal Minister for Industry and Science, Ian Macfarlane, and Western Australian Minister for Mines and Petroleum, Bill Marmion, have executed a deed of agreement setting out the proportion of petroleum in the Torosa petroleum pool.
The Torosa petroleum pool straddles Commonwealth and WA retention lease areas and is intended to be developed through the proposed Browse floating LNG (FLNG) project.
The deed of agreement was also signed by senior representatives of the Browse Joint Venture, reflecting the requirement for an agreement between the three parties under Commonwealth and WA legislation.
"This is the first time an agreement of this sort has been struck between governments and reflects our commitment to securing the next wave of investment in the Australian LNG sector," Mr Macfarlane said.
"This deed of agreement represents an allocation of petroleum between the Commonwealth (34.6%) and the State of Western Australia (65.4%) based on the best available technical data. It will provide certainty to the Browse Joint Venture over the life of the project, reinforcing Australia's reputation as a stable investment destination.
"It is an example of governments working together to support the development of our offshore resources for the benefit of all Australians."
The deed of agreement and the Commonwealth and WA Governments' recent renewal of the Browse retention leases contributed to the Joint Venture's decision to enter into the front-end engineering and design (FEED) phase announced on July 1, 2015.
Mr Macfarlane and Mr Marmion praised the close collaboration between parties, noting that the renewal and apportionment decisions were delayed until governments could resolve issues associated with the May 2014 boundary changes affecting the existing retention leases.
"Minister Macfarlane, the Browse Joint Venture and I have been able to achieve an outcome that provided the requisite certainty for the Joint Venture to move into FEED," Mr Marmion said.
"Our efforts maintain security of tenure for the titleholders and ensure a fair return to the WA economy if and when the proposed Browse project proceeds."
Mr Macfarlane said the Browse Joint Venture was scheduled to make its final investment decision on the proposed project late next year.
"Minister Marmion and I look forward to a final investment decision on the proposed project though we both recognise that, in this time of increasing competition, there is still much work for the Joint Venture to complete to make this project viable," Mr Macfarlane said.
"The economic benefits of the proposed Browse project to WA and Australia are enormous and we are committed to seeing our offshore petroleum resources developed.
"Both governments have done what we can to facilitate this development; the onus is on the Joint Venture to achieve the earliest possible development."
The deed of agreement allocates the proportion of gas and condensate in Commonwealth retention lease WA-30-R and State retention leases TR/5 and R2 and will continue to apply if production licences are granted over these areas.