Subject: Gas deal with Australia close, says E Timor

Also: AP- Alkatiri Visits Norway to Study Oil Market

Last Update: Wednesday, May 25, 2005. 0:44am (AEST)

Gas deal with Australia close, says E Timor

East Timor and Australia are "very close" to reaching a deal on billions of dollars of oil and gas reserves under their shared Timor Sea, East Timor Prime Minister Mari Alkatiri said in Norway.

"I do believe that we are close to a deal, very very close to get a deal, but still we need to work on some details of the agreement," Mr Alkatiri told reporters.

It had previously been reported that an agreement has been concluded, but on Saturday East Timorese officials again denied that a compromise accord had been signed.

"We are not rushing. We're looking for a good agreement between two neighbour states," Mr Alkatiri said after a meeting in Oslo with his Norwegian counterpart Kjell Magne Bondevik.

"We've been discussing for almost three years. It's still a very short time. Everywhere around the world, (countries) have been discussing for hundreds of years and they're still waiting to resolve" their problems, he said.

A 1972 sea boundary agreed between Australia and Indonesia gave Canberra two-thirds of the sea area between the two nations and most of its energy resources, estimated to be worth around $42 billion.

East Timor, which won independence from Indonesia three years ago, wants the boundary set at the mid-point between East Timor and Australia, giving it most of the resources.

Mr Alkatiri refused on Tuesday to disclose the details of the compromise discussed with Australia.

One of the poorest countries in Asia, East Timor hopes to follow in oil-rich Norway's footsteps in managing its revenues of black gold, and like the Scandinavian country is in the process of setting up an oil fund where the revenues can be put aside for future generations.

Mr Alkatiri said he also hoped to set up a state-controlled oil company like Norway's Statoil, which is 70.9 per cent-owned by the state.

"The example of Statoil is a very good example. We believe we need a national company as a way to really control our resources," he said, adding that such a project could become a reality before the end of the year.

-AFP



AP: Alkatiri Visits Norway to Study Oil Market

Tuesday May 24, 9:26 am ET
By Doug Mellgren, Associated Press Writer

OSLO, Norway (AP) -- East Timor's Prime Minister Mari Alkatiri opened a four-day visit to Norway on Tuesday to study the Nordic nation's oil industry.

East Timor, which gained independence from Indonesia in 2002, is developing its offshore oil industry with advice from Norway, the world's third-largest oil exporter after Saudi Arabia and Russia.

"In East Timor, we are at the beginning of this process of oil development," Alkatiri said, appearing with Norwegian Prime Minister Kjell Magne Bondevik at a news conference.

An initial hurdle to some of East Timor's offshore oil development is agreeing on a border in the potentially petroleum-rich Timor Sea that separates it from southern neighbor Australia.

"I do believe we are very, very close to a deal," said Alkatiri, declining to give details. "I do not negotiate via the media."

The two nations have been haggling for more than a year over how to divide up an estimated US$30 billion (euro23.5 billion) in revenue from gas and oil under part of the Timor Sea.

As a guest of the Norwegian Petroleum Directorate, Alkatiri will meet top political and oil industry leaders. He will also attend seminars on Norway's Government Petroleum Fund, which invests surplus oil revenues abroad for future use, and on the state-controlled oil company Statoil ASA.

Impoverished East Timor is now setting up oil industry regulations and an oil fund and plans a state oil company, largely based on Norwegian models, Alkatiri said.

"We have to manage the oil resources on the principle of leaving resources for future generations," the East Timor premier said. "We also do believe we need a national oil company to help manage the resources."

The petroleum directorate has a six-year cooperation agreement with East Timor on managing oil resources.

After the news conference, the head of the directorate, Gunnar Berge, said even though Norwegian oil companies may do business in East Timor, that was not the point of current cooperation.

"The core of the project is to enable East Timor to best use their resources," he said. "We have expertise in handling the big international oil companies, so they are under national control, rather than the other way around."

Alkatiri's visit lasts through Friday.



 

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