Woodside Petroleum on Thursday welcomed the Timor Sea gas agreement between Australia and East Timor but said the Greater Sunrise gas project would remain on hold for now.

The two governments on Thursday announced a deal that would see them share revenues from the Greater Sunrise field 50/50, while East Timor received 90 per cent of royalties from the rest of the area known as the joint petroleum area.

The two countries also agreed to put aside the dispute over their maritime boundary for 50 years.

Negotiations were protracted and at times heated, and at the end of 2004 a frustrated Woodside said it was putting Greater Sunrise on hold due to the lack of certainty.

Woodside on Thursday congratulated the two governments on getting to this stage, but said there were still a few steps to go before the joint venture partners in Greater Sunrise would be making any decisions.

"The first step for us is to understand what's in the agreement," Woodside spokesman Roger Martin said. "And the next step is for the agreement to be ratified by the Australian and [East] Timor parliaments, so there are a few more steps along the way."

Mr Martin said there was almost no-one working on Greater Sunrise at the moment and it was too early to say whether people would be reassigned to the project now a deal had been struck.

"It is now a matter for us of actually understanding what is in the agreement and understanding the timetable for application before we make decisions about getting a team together," he said.

The Greater Sunrise project is touted as a $US5 billion ($6.63 billion) development with the Timor Sea field estimated to contain about eight trillion cubic feet of gas and about 300 million barrels of condensate.

The field is 450 kilometres from Darwin and about 80 kilometres from East Timor.

The East Timorese have been keen for gas from Greater Sunrise to be processed in East Timor but Woodside said Darwin was its preferred option.

"We have previously stated a preference for the field to be connected by pipeline to an LNG plant in Darwin and that is still Woodside's position, but it is not something that has been settled," Mr Martin said on Thursday.

Woodside is the operator of the Greater Sunrise project and has a 33.44 per cent stake. US oil and gas giant Conoco Phillips has a 30 per cent stake, Anglo-Dutch multinational Shell 26.56 per cent and Japanese energy company Osaka Gas 10 per cent. The joint venture partners have already spent about $250 million on the project.