Oceanic Exploration Feasibility Study for the East Timor Pipeline

7. ECONOMICS AND COSTING

7.1 GENERAL

The costing data sheets are contained in Appendix 4 of this document for the following pipelines:

Option 1
The cost of the 28-inch Outside Diameter Pipeline from Bayu Undan to Suai would be approximately USD 317 million.

Option 2
A 10-inch Outside Diameter Pipeline from Bayu Undan to Suai would cost approximately USD 143 million.

Option 3
The cost of the 28-inch Outside Diameter Pipeline from Sunrise to Bayu Undan would be approximately USD 171 million.

Numerous pipeline sizes have been considered for the Bayu Undan to Darwin pipeline. As stated in Reference [5] the cost of the Bayu Undan to Darwin may be USD 732.75 million. It is not known what size of the pipeline this is based upon.

As the pipeline distance from Bayu Undan to Darwin is approximately 500 km the flow of a 28-inch Outside Diameter Pipeline would be less than for a pipeline to Suai (only 220km). It is considered that a pipeline of an outside diameter of 32-inch from Bayu Undan to Darwin should deliver the same flow as a 28-inch Outside Diameter Pipeline from Bayu Undan to Suai. Performing a comparative costing using the same basis of estimating indicates that a 32-inch Outside Diameter Pipeline from Bayu Undan to Darwin would be USD 571 million.

The alternative route from Greater Sunrise to the North East of East Timor may be cheaper than Option 1 due to the reduction in pipeline length. It is not considered that the cost difference would be out with the tolerance of this costing.

7.2 CONCLUSION

The prices above are approximate, as no specific project data was available for this report. Variations in scope, technical details, and items such as owner¹s costs, etc. could produce a –20% to +50% cost variation.

NEXT SLIDE