Timor-Leste Petroleum Fund

Petroleum Fund Timor Leste

East Timor US$ 11.8 Billion
Established: 2005
Transparency Rating: 8		 Origin: Oil & Gas
Firm Investment Style: Index
Entity Structure: Fund

 

Summary
The government of Timor-Leste announced the inception of the Timor-Leste Petroleum Fund in August of 2005. The Minister of Planning and Finance of the government of Timor-Leste, is responsible for managing the fund. The Minister of Planning and Finance; however, signed an agreement with the Banking and Payment Authority to take responsibility of the fund.

By late 2006, the Timor-Leste Petroleum Fund had reached US$ 1,011,763,807. Due to the Bayu-Undan project, which yielded an estimated 25-year field life of wet gas, profitability increased. By the end of 2007, the sovereign fund’s balance was slightly over US$ 2 billion.

 Strategy & Objectives:
The Petroleum Fund Law requires that not less than 90 percent of the portfolio be invested in debt instruments and deposits denominated in U.S. dollars. The sovereign wealth fund is currently mandated to invest only in US and other sovereign debt instrument

Governance
The government of Timor-Leste, represented by the Minister of Planning and Finance, is responsible for the overall management and investment strategy of the Petroleum Fund. The Petroleum Fund law delegates the responsibility to the Banking and Payments Authority (BPA) to undertake the operational management of the Fund under an agreement with the Minister. In 2005, a management agreement between the BPA and the Ministry of Planning and Finance was signed.

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