UK Edition
Australia and East Timor sign historic maritime boundary deal, despite tensions over division of £47bn oil field
Australia and East Timor on Wednesday signed what Canberra’s foreign minister Julie Bishop called "a milestone” agreement on a maritime boundary between the two countries.
The treaty ends a long a bitter dispute between the neighboring countries and paves the way for exploitation of billions of dollars in gas and oil under the Timor Sea - with at least 70 percent of the revenue to go to impoverished East Timor.
The agreement was also historic because it marked the first successful conclusion of "conciliation" negotiations to settle maritime differences under the UN Convention on the Law of the Sea.
Estimates suggest the Greater Sunrise field could contain up to $65 billion (£46.8 billion) worth of hydrocarbons. East Timor's existing fields are nearly empty but oil and gas contribute between 80-90 per cent of government revenue.
How much money the country, a half-island nation of 1.3 million people who are among the poorest in the world, ends up getting depends on what deal is worked out to drill and pipe the underwater gas.
The deal comes after years of acrimony in which Australia was accused of bullying and of spying on East Timor during negotiations.
"Throughout this long saga, there really isn’t much that the Australian Government can be proud of. It lied and cheated to short-change East Timor at every opportunity,” said Tom Clarke, spokesman for the Timor Sea Justice Campaign.
The allegations continued on the eve of the treaty signing in New York, with a leaked letter from chief negotiator and former prime minister Xanana Gusmao to the UN accusing Australia of “colluding” with energy companies to ensure oil and gas gets piped to Darwin instead of East Timor, which would deprive the smaller nation of downstream financial benefits from processing the resources.
East Timor says Australia stands to gain £14 billion if the oil and gas is processed there. However Australia has previously denied any collusion and said it is just doing what is in Australia's best interest.
Despite the latest tensions, the signing went ahead on Wednesday, with Ms Bishop calling the deal a "landmark event".
"Both our governments have deemed this to be a just and equitable outcome," she said at the signing.
East Timor's minister for delimitation of borders, Hermenegildo Augusto Cabral Pereira agreed, saying: "Today is indeed a momentous day that will be recorded in East Timor's history and be remembered and celebrated. ... With the signing of this treaty today, we write a new chapter in the friendship between our two countries."
For East Timor, where 65 per cent of people are looking for jobs, the treaty is crucial to economic development and employment opportunities.
"We believe seriously that a successful pipeline to the south coast of Timor would be a game changer and have a transformational impact on the socio-economic status of the country," he said.
East Timor was invaded by Indonesia in 1975 after the previous Portuguese colonisers withdrew. Jakarta’s occupation resulted in the deaths of around 200,000 Timorese before it in turn pulled out in 1999.
East Timor has since patched up relations with Indonesia and hopes to join the Association of Southeast Asian Nations (ASEAN), headquartered in Jakarta.