Received from Joyo Indonesia News

Associated Press Friday, November 14, 2003

East Timor PM Accuses Australia Of Delaying Oil Talks

CANBERRA (AP)--East Timor's prime minister Friday accused Australia of deliberately dragging out talks aimed at bolstering his impoverished nation's share of billions of dollars worth of oil and gas under the sea dividing the two nations.

Speaking to The Associated Press by phone from the capital Dili, Prime Minister Mari Alkatiri said his tiny country, desperate to get oil and gas revenue flowing, had been pressured to sign a temporary agreement to carve up the riches earlier this year.

"It was always deadline over deadline to have it done in a timeframe that was not easy for ... a new country to respond to," Alkatiri said of the pressure from Canberra and oil companies.

Officials from Australia and East Timor met in northern Australia earlier this week to begin the long process of setting a permanent maritime boundary between the two nations which would settle once and for all each country's share of the oil and gas field.

Alkatiri said East Timor is eager to set the border fast - in three to five years - but added that Canberra is in no hurry, probably because a permanent boundary would scrap existing revenue-sharing treaties that favor Australia.

"We have proposed monthly meetings, they are only ready for twice a year meetings," Alkatiri said. "With this type of schedule maybe my grandson and granddaughter will resolve the problems."

At stake are billions of dollars in revenues needed to drag the half island state out of debt and poverty.

"It would really break our dependency from these donors and the whole process of the development of the country would take another step forward," Alkatiri said.

East Timor gained independence 18 months ago following four centuries of colonial rule by Portugal and 24 years of brutal Indonesian occupation. The country of 800,000 is just beginning the huge task of rebuilding and developing infrastructure.

Outside of Dili, residents live on as little as 55 U.S. cents a day. Many people have no phones, electricity or clean water.

Alkatiri says the border should be drawn in the middle of the 600 kilometers of sea separating one of the world's most affluent nations with one of its poorest.

That would place 90% of the oil and gas reserves on East Timor's side. Australia wants its continental shelf to be the border. In some places that's just 150 kilometers from East Timor's coastline.

Under the current agreement, East Timor gets 20% of the Greater Sunrise gas field, the richest in the area. Australia takes 80%.

East Timor also gets 90% of several fields in a "joint development" area to Australia's 10%, but those fields aren't as lucrative.

Not covered by those treaties are three other fields - Buffalo, Laminaria and Corralina - which lie on East Timor's side of the disputed area. Australia has a 100% claim on those and has received around US$1.2 billion in revenue since 1999.

Alkatiri said Australia ignored a request early this year to stop production in those three fields until the boundaries are settled.

Dili estimates the current deal will give it about US$4 billion in revenues over the next two to three decades. Under what Alkatiri believes are its "entitlements under international law," the country would get US$13 billion.

Over 20 years the difference is between US$200 million a year and US$650 million a year. East Timor's annual budget is now US$80 million.

Australian officials weren't immediately available for comment but have previously described the current division of riches as generous.

Alkatiri rejected that.

"If you applied international law 100% should be ours," he said. "But we are ready to negotiate and resolve the differences."