Oceanic/Petrotimor has long been concerned about various misrepresentations regarding the feasibility of building a pipeline to East Timor from Bayu Undan. Accordingly, the companies commissioned an engineering and cost study which shows that building a pipeline from the Timor Sea to East Timor is both technically feasible and cost competitive with building a similar pipeline to Darwin.

The study was completed by INTEC Engineering, a respected international pipeline engineering company, with input from Heerema Marine Contractors, a leading deep water pipeline contractor.

Oceanic/Petrotimor is pleased to contribute this study to East Timor with the request that its parliament seriously consider the possibility of an LNG plant in East Timor instead of Darwin so that the value added and employment benefits would accrue to the owner of the gas, as is customary in the global energy business. East Timor could also separately consider a pipeline for domestic power generation and industrial development requirements. Oceanic/Petrotimor is prepared to further assist East Timor in selecting the best landfall possible for such a pipeline.

Oceanic/Petrotimor would propose contribute to financing the construction of such a pipeline to East Timor with proceeds from the 10% government revenue share of oil and gas production from the Joint Development Area that Australia is scheduled to receive under the recent Timor Sea Treaty, signed on May 20, 2002 by Downer and Mari Alkatiri (still subject to ratification by East Timor's parliament).