Also - AU: East Timor's tough talk delivers nothing and AU Letter: Don't blame Timor

PRESS RELEASE

FOR IMMEDIATE RELEASE ­ 17th January, 2005.

Australian Government at fault over Sunrise delay:

The Howard Government’s policies on the Timor Sea are to blame for Woodside Petroleum’s decision to delay the development of the Greater Sunrise petroleum field in the Timor Sea, an Australian lobby group said today.

Woodside Petroleum announced on Friday that it had shelved plans to develop the huge Greater Sunrise natural gas fields in the Timor Sea citing fiscal and legal uncertainties.

The blame for the shelving of this project must sit squarely with the Australian government.” said Tom Clarke, coordinator of the Timor Sea Justice Campaign.

For the project to proceeded, Woodside required legal certainty, based on the agreement of both the Australian and East Timorese governments. This agreement could only be reached based on fair negotiations and on each country receiving its entitlement under international law. But sadly for everyone involved, Australia instead tried to bully East Timor into accepting billions less than it was entitled to under international law.” Clarke continued.

The fact is that if boundaries were drawn in accordance with international law, most or all of Sunrise would belong to East Timor ­ after all, the field is 450km from Dawin but only 80km from the Timorese coast. But under the Unitisation Agreement, East Timor was forced to accept, 82% of revenues from Sunrise went to Australia, and just 18% to East Timor.” claimed Mr Clarke noting that, “No government would sign off on a deal in which it lost $10 billion of revenues it was entitled to ­ but this is precisely what Australia demanded of East Timor.”

In March 2003, East Timor was forced to sign the Greater Sunrise Unitisation Agreement, after the Australian government threatened the development of the Bayu Undan field if agreement was not reached. The agreement gave 82% of the revenues from the field to Australia and just 18% to East Timor, despite the fact that the field is twice as close to Timor as to Australia.

The Unitisation Agreement was intended to be a provisional agreement, which would be superseded by permanent maritime boundaries set between the two nations. The agreement was undermined in November 2003, when it became clear that the Australian government was stalling on negotiations on permanent maritime boundaries.

Negotiations in 2004 continued to falter, as Australia insisted on the continental shelf principle, despite the fact that East Timor and Australia lie on the same continental shelf, and that the principle is outdated as a matter of international law. East Timor’s argument, based on the dominant median line principle, was that resources closer to East Timor should belong to East Timor, and those closer to Australia to Australia.

The Australian government further undermined the prospect of Greater Sunrise in March 2004 when it issued exploration licenses around Sunrise, despite the protests of the Timorese government.

The East Timorese Government has no international legal avenue for this dispute as two months before East Timor’s independence, the Howard Government preemptively withdrew from the jurisdiction of the International Court of Justice and International Tribunal on the Law of the Sea.

The Timor Sea Justice Campaign coordinator stated, “At the end of the day, the Australian government’s tactics of brinkmanship and bullying have cost jobs and development.”

For more information, please contact:

Tom Clarke, Timor Sea Justice Campaign

Coordinator. 0422 545 763 tom@timorseajustice.org

PO Box 2949 Fitzroy, 3065. www.timorseajustice.org

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The Australian

East Timor's tough talk delivers nothing

AS an example of how to talk tough and achieve nothing, it is hard to beat the performance of the East Timor Government over the Greater Sunrise gas project. Whoever advised the East Timorese to refuse to ratify the 2003 agreement splitting revenue from the resource 80:20 in Australia's favour, on the assumption that Canberra would give more, was dead wrong. No deal was done by the end of year deadline set by project developer Woodside, which has now ended work on the $5 billion project. It is likely the resource will stay where it is for at least a decade, and that instead of getting 20 per cent of the earnings from the 7.8 trillion cubic feet of gas, East Timor will now receive 100 per cent of nothing.

There is sense on both sides of the argument over which country controls the Greater Sunrise reservoirs. The East Timorese say the field is just 80km off their coast and 450km from Darwin. The Australian reply is that Greater Sunrise is on the continental shelf, and that the maritime boundary is the 3000m-deep Timor trough. Setting the boundary where the shelf stops is also the basis for Australia's seabed arrangements with Indonesia. But the reality of this argument has little to do with international law and everything to do with brinkmanship. Canberra believes the gas belongs to Australia and refuses to be blackmailed by East Timorese accusations it is behaving like a bully. The essence of the East Timorese argument is that they are poor, Australia is rich, and Canberra is mean not to let the gas go to the people who need it most. Nonsense. Australia's support for East Timor is obvious, and no doubt aid will continue to flow. But this does not mean Canberra should surrender what it holds to be its sovereign right over Sunrise. And by demonstrating such stubbornness, the East Timorese have hardly advanced their cause with energy companies in other resources. It looks like sunsets for East Timor's energy ambitions for quite a while.

http://www.theaustralian.news.com.au

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The Australian

Don't blame Timor

18jan05

HOW dare your editorial (17/1) blame Woodside's withdrawal from the Greater Sunrise project on the East Timorese Government's determination to seek what is rightfully theirs?

As you mentioned, the Greater Sunrise reserve is only 80km from the Timorese Coast yet 450km from Darwin.

Under contemporary principles of international law this resource would be completely within East Timor's maritime boundary.

Knowing this fact, the Howard Government pre-emptively withdrew from the jurisdiction of the International Court of Justice and International Tribunal on the Law of the Sea just two months before East Timor's independence ­ leaving no legal avenue for East Timor to challenge the Australian Government's resource theft.

The Australian Government's preposterous continental shelf argument is outdated as a matter of international law.

The Timor Sea Justice Campaign believes Woodside's decision to postpone its involvement in the Greater Sunrise field highlights how the Australian Government's lack of commitment to negotiating permanent maritime boundaries with East Timor is creating a level of uncertainty that Australian businesses are uncomfortable operating in.

This policy is not only bad for the East Timorese, but bad for business and for Australia.

It's worth remembering that the East Timorese people resisted Indonesia's brutal occupation and eventually gained independence despite all odds.

They are not about to give in so easily to yet another powerful neighbour which is attempting to violate their sovereignty and blatantly ignore international law. Nor should they.

Tom Clarke

Timor Sea Justice Campaign

Fitzroy, Vic

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