How Timor-Leste is helping energy companies raise money through a carbon-neutral round

Felix Tsourakis
November 1, 2021
2 min

How Timor-Leste is helping energy companies raise money through a carbon-neutral round

The past two years brought transformative changes to how energy investments work, especially for IOCs looking to raise capital and invest in new projects. Investor sentiment has switched from traditional hydrocarbons projects to carbon-neutral projects that align with energy transition. Due to this transformation, the new role of hydrocarbon agencies - not as stakeholders - but as partners to energy companies has become more important than ever.

One of the countries that became aware of this early in 2020, was Timor-Leste. Thanks to their uninterrupted communication with IOCs during the pandemic, ANPM, the country’s hydrocarbon agency, recognised the challenges operators face, and created a plan that safeguards the environment while helping IOCs reduce their carbon footprint.

Updated Licensing Round Timeline

While the interest for Timor-Leste’s Second Licensing Round is high, with several new companies prequalifying, ANPM decided to extend the round. The round was very strong during the pandemic thanks to online roadshows, the online data room and continuous asset marketing in online events.

ANPM will be extending the Licensing Round prequalification period until 14th January 2021, to accommodate energy companies that are raising capital, and have the opportunity to meet many of the prequalified companies in person now that physical events are back.

You can see the updated timeline here:

The new Midstream Plan

On October 2021 ANPM presented its new midstream plan to investors, separating the Tasi Mane mega-project to smaller refineries, LNG plants and downstream projects, distributed in strategic locations throughout the island.

Instead of requiring new operators to build large pipelines to connect to the mainland, ANPM has planned for a connected network of pipelines connecting to Greater Sunrise and each other, before a large pipeline transfers the gas from the Greater Sunrise field to the upcoming downstream facilities, including a newly planned onshore LNG plant. Thanks to this, operators will only have to invest and plan a connection to the Greater Sunrise pipeline.

Carbon Capture Storage plans and beyond

IN-VR has been receiving constant feedback from its M&A services that investors are becoming more demanding for carbon neutral and energy diverse projects, before financing operators.

ANPM signed an MOU with Santos, to proceed with a carbon capture and storage (CCS) project, estimated to cost $1.6 billion, at the ageing Bayu Undan field in the Timor Sea.The country plans to use the aging field as the main hub for carbon storage for the entire region of South-East Asia, and help the region reach carbon neutrality.

Currently, ANPM is exploring the potential to stockpile carbon-credits, and offer them to companies investing in offshore and onshore projects in the country, helping EPs reach their goals by making their projects carbon neutral,  and financing them more easily.

The Ministry of Petroleum and Mines, and ANPM are currently exploring how to develop this scheme and implement it under their commercial and fiscal package.

Given the past 15 months, Timor-Leste’s direction to allow more time for investment decisions, as the country’s ambitious new energy plan takes form and new partners enter the industry, will allow investors to position their companies as carbon-neutrality driven operators that are shaping the region, something that stakeholders all over the world will not be able to ignore.

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