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CNRT statement on Timor Gap oil

The first oil production from East Timor's offshore oil reserves is due to begin in the next few days.

This oil is a natural resource from which the people of East Timor have a right to benefit under International Law. This right is inextricably bound to their right of self-determination.

The start of oil production by joint venture partners BHP, Santos, Petroz and Inpex Sahul from the Elang Kakatua field in what is called the 'Zone of Cooperation', means that, under the fiscal terms of the Timor Gap Treaty (TGT) between Australia and Indonesia, a share of revenue will flow to Jakarta.

Elang Kakatua is a relatively small oil field containing some 30 million barrels of oil, yielding some 600 million US dollars in revenue over four to five years. Royalties and tax revenues to the Indonesian Government would be some 130 million US dollars.

The Indonesian government intends to appropriate part of this oil revenue in an act of international resource theft, in collusion with the Australian government through the TGT.

The National Council of Timorese Resistance (CNRT) has the duty to ensure that this revenue remains the property of the people of East Timor.

CNRT demands that until an internationally acceptable resolution of the East Timor conflict is achieved, the funds currently destined for Indonesia be placed in a special trust fund for the people of East Timor by the Timor Gap Joint Authority.

The East Timorese people aided by the internationally recognised legal administering power of East Timor, Portugal, have challenged the TGT in the International Court of Justice (ICJ) in the past. The ICJ reaffirmed the right of the people of East Timor to self-determination.

CNRT Vice-President, Nobel Laureate Dr José Ramos Horta, said "the East Timorese people will continue challenging the unjust arrangements of the Timor Gap Treaty. They will undertake all necessary legal actions ensuring them a just share in their natural resources. They will do their utmost to recover the proceeds of the exploitation of their natural resources that may be misappropriated by others".

So far, only political factors have prevented Portugal and the East Timorese people from being successful in their legal actions, despite justice and international public opinion being clearly on the side of the East Timorese.

The recent dramatic changes in Indonesia offer much hope for change.

With the demise of the Suharto regime and the collapse of the Indonesian economy, the previous political balance has changed. With the Indonesian economy facing its worst crisis in decades, it has become increasingly difficult to maintain the many battalions of troops in East Timor which previously have enabled the TGT to remain operative. President Habibie seems to be aware of this.

The CNRT is of the opinion that a realistic assessment of the current situation after the recent political changes in Indonesia which bring improved prospects for a peaceful settlement of the East Timor issue, should lead the oil companies operating in the Timor Gap Area, as well as the Australian Government, to realise that they can not continue ignoring the rights of the East Timorese people.

CNRT calls upon the Australian Government and the oil companies operating in the TGT area to review their past assumptions and face current realities. Under present conditions a review of the TGT in a spirit of fairness and justice will greatly enhance the political and economic stability of the Timor Sea region. This will enable oil companies to operate in a secure and predictable environment, for the benefit of all stakeholders.

The National Council of Timorese Resistance will endeavour to show the Australian Government and the Timor Gap contractors that their commercial interests will not be adversely affected by East Timorese self-determination. The CNRT supports the rights of the existing Timor Gap contractors and those of the Australian Government to jointly develop East Timor's offshore oil reserves in cooperation with the people of East Timor.

CNRT sympathises with the people of Indonesia, currently suffering great economic hardship due to years of irresponsible leadership of the corrupt Suharto regime. However, the needs of the people of East Timor, devastated by 23 years of brutal Indonesian occupation, are as great if not greater.

CNRT is conscious of its duty to defend the natural resources of East Timor, including the offshore petroleum resources, and to ensure that their exploitation benefits the welfare and security of the East Timorese nation.

CNRT deems it imperative to find a satisfactory and just solution to the situation raised by the present Elang Kakatua oil production, as in three years time, extraction of natural gas liquids from the huge Undan-Bayu reservoir in the Timor Gap area is scheduled to commence. Revenues from exploitation of these petroleum reserves, estimated to be equivalent to 900 million barrels of oil, will dwarf those arising from Elang Kakatua.

Signed by
José Ramos-Horta, Deputy President
Mari Alkatiri, Member of the National Political Commission
João Carrascalão, Member of the National Political Commission

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