The Wall Street Journal June 25, 2004

Letter to the Editor

Australia's Sovereign Rights

Criticism of Australia's motives in relation to settlement of permanent maritime boundaries with East Timor in your June 10 article, "For East Timor, Energy Riches Lie Just Out of Reach," is offensive and disingenuous.

In recent years, no country has done more than Australia to assist the people of East Timor. Our role in East Timor's transition to independence and its subsequent stabilisation has been crucial. We currently provide some 440 troops and 21 police. Since 1999 we have delivered humanitarian aid, development assistance and defence cooperation valued at a total of more than $270 million.

Australia is committed to negotiating permanent maritime boundaries with East Timor. The first round of negotiations was held in April and a second round will take place later in the year. Certainly there are competing claims -- that is what these complex negotiations are to resolve.

Under the Timor Sea Treaty, Australia has already agreed to a very generous interim arrangement that splits petroleum revenues from the Joint Petroleum Development Area (JPDA) 90:10 in favour of East Timor. Under previous arrangements with Indonesia the split was 50:50.

Among the myths propagated on this issue is the claim that international law dictates a median line between the two countries as the only solution for a permanent maritime boundary. In fact, natural prolongation of the continental shelf, on which Australia bases its claims, remains a valid source of seabed jurisdiction under international law.

Another myth is that a median-line approach would give East Timor all or most of the oil and gas resources in the Timor Sea. This is also incorrect. Such an approach could well leave East Timor without any share, for instance, of the Bayu-Undan gas field, rather than the generous 90% share East Timor currently enjoys. Moreover, a median line approach would not give East Timor any materially larger share of the fields -- such as Greater Sunrise and Laminaria -- that lie wholly or predominantly outside the JPDA and within sole Australian seabed jurisdiction.

To cede territory merely on the basis that a neighbour is poorer would reduce international law to a farce. Under such absurdity, we could see the Texas oil fields ceded to Mexico.

It is clearly in Australia's national interest that East Timor becomes a stable and self-sufficient neighbour. East Timor currently stands to derive enormous economic benefits from the Timor Sea resources. However, those resources are not all East Timor's. Australia makes no apology for protecting its sovereign rights.

Alexander Downer Minister for Foreign Affairs Canberra

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