UN blames Australia for Timor Gap treaty delay

DARWIN, Australia, June 20 (AFP) - The United Nations blamed Australia Wednesday for delays in finalising a treaty dividing revenues from oil and gas reserves in the Timor Sea between Australia and East Timor.

Australia's decision to introduce new issues to treaty negotiations was delaying a final agreement, United Nations Transitional Administration in East Timor (UNTAET) political affairs chief Peter Galbraith said.

"We were close to reaching an agreement. We had a text of which only a couple of items were unresolved and there was a path to resolve them," Galbraith told Australian Broadcasting Corp. radio.

"But since then, some new issues have been introduced by the Australian side and that's making it more difficult.

"I think they can be easily resolved on the basis of the text we had been working on until just a week ago. But now, I don't know."

He did not specify what those new issues were.

Galbraith said it was almost impossible for negotiations to reach a settlement between the July 15 deadline stipulated by Phillips Petroleum before it would embark upon multi-million dollar gas pipeline development in the Timor Sea, and the formation of East Timor's first government.

"It will be very difficult if not impossible for any agreement to be concluded between July 15 and when the new government takes place after the election of a constitutional assembly," Galbraith said.

"It does make it more difficult to find a path forward. Nonetheless we want to have an agreement, we want to have it quickly and we are prepared to work around the clock if it can be done."

Treaty negotiations are scheduled to resume next week in Canberra.

East Timor is counting on revenues from oil and gas reserves in the Timor Sea to underpin its national budget when projects come on line from 2004.

Under a previous agreement with Indonesia, Australia and Indonesia were assigned one zone each in the Timor Sea, with revenues from a third zone to be split equally.

However, East Timor's bloody secession from Jakarta's rule in 1999 forced Canberra to renegotiate the treaty with the UN and the territory's fledgling administration.

Once ruled by Lisbon and later annexed by Jakarta, East Timor is scheduled to hold its first democratic elections on August 30.

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