Conciliation proceedings were conducted by the Permanent Court of Arbitration in Kuala Lumpur, Malaysia, on the 25 February 2018.
The dispute arose over the maritime border between the countries, which was straddled by the Greater Sunrise field, leading to disagreement over the development and economic benefits of the field.
However, the concerned parties have now reached agreement on a treaty which delimits the maritime boundary, addresses the legal status of the Greater Sunrise gas field, the establishment of a Special Regime for Greater Sunrise, and a pathway to development of the resource.
The treaty also establishes revenue sharing arrangements between Australia and Timor-Leste, where upstream revenue allocated to each of the parties will differ depending on downstream benefits associated with the different development concepts for the field.
The Greater Sunrise gas field is located on the disputed border 450 km northwest of Darwin, with an estimated $40 billion of oil and gas deposits.
It was reported in November last year that Timor-Leste was insisting that gas from the field would be piped to its shores; suggesting that an LNG plant on Timor-Leste would be built should that option be chosen.
The joint venture partners have previously preferred the option to pipe the gas back to the existing Darwin LNG Project or a FLNG vessel due to a deep ocean trench between the field and Timor-Leste.
The Greater Sunrise Joint Venture is made up of Woodside Energy (33.44 per cent and operator), ConocoPhillips (30 per cent), Shell (26.56 per cent) and Osaka Gas (10 per cent).