Localized carbonate cementation occurs in the Eocene Grebe Sandstone of the Vulcan Sub-basin, Timor Sea, Australia. The cements have been previously interpreted as originating from microbial methane oxidation and sulfate reduction in a shallow subsurface environment and were related to hydrocarbon leakage. Here we reassess these localized carbonate cements in the Grebe Sandstone, and reported new findings. Petrography shows that there are two facies of sands in the Grebe Sandstone: (1) cemented, mostly fine-grained sands; and (2) loose, often coarse-grained sands. In addition, two types of carbonate matrix occur in the Grebe Sandstone: (1) spars to microspars in calcareous, fine-grained sandstones; and (2) micritic to microsparry matrix associated with limestone grains. Stable carbon isotopic values reveal that only the cements associated with sandstones were probably hydrocarbon-derived, and the resultant mineral is mainly calcite. Petrographic attributes and Mn⁺² and Co⁺² compositions of these cements differ significantly from those of modern cold-seep carbonates at or near the sea floor. Moreover, the hydrocarbon-derived carbonate mineralization only occurs in the fine-grained sands, not in the coarse-grained sands. In other word, the cementation was not only dependent on hydrocarbon leakage but also on the lithofacies of the host rock. We propose that the extent of hydrocarbon-related cementation alone cannot be used to evaluate the trap integrity as has been previously suggested.