Subject: RT: Australian opposition calls for Timor Gap review
Date: Wed, 13 Jan 1999 09:38:41 -0500
From: "John M. Miller" <>

Australian opposition calls for Timor Gap review 03:01 a.m. Jan 13, 1999 Eastern

By James Regan

SYDNEY, Jan 13 (Reuters) - Australia's Labor opposition urged Prime Minister John Howard's government on Wednesday to review its Timor Gap oil sharing treaty with Indonesia as East Timor pushes for independence.

But Deputy Prime Minister Tim Fischer said talk of a review of the special arrangements in the Timor Gap -- located in a specially designated Zone of Cooperation -- was premature. ``This is absolutely premature ... there's no question of change of sovereignty at this time,'' Fischer said. ``It (the treaty) stands.''

Australia said on Tuesday it was changing its policy on East Timor and would support a drive for self determination for the Indonesian-run province, located about 400 kms (250 miles) north of Australia's northwest coast.

But political analysts stressed any such arrangement would take a decade or so to negotiate, if ever.

``Clearly any meaningful arrangements for autonomy should allow control by the East Timorese people over their natural resources,'' Labor's foreign affairs spokesman Laurie Brereton said.

Indonesia invaded East Timor in December 1975 after Portugal, the former colonial power, pulled out. Jakarta formally annexed the territory a year later, a move never recognised by the international community.

Australia is the only Western country to recognise Indonesian sovereignty over East Timor.

The Timor Gap treaty was signed by Indonesia and Australia in 1989 and splits the sea between East Timor and Australia into three zones, one Australian, one Indonesian and the Zone of Cooperation (ZOCA) shared by Australia and Indonesia.

Under its terms, revenue from production from the ZOCA is shared equally between Australia and Indonesia.

Oil production from the region's Elang, Kakatua and Kakatua North fields, run by Australia's Broken Hill Pty Co Ltd, started in July 1998.

More substantial production is expected to come on stream in 2002 after development of the A$1.5 billion Bayu-Undan natural gas and condensate field.

BHP and Phillips Petroleum Co, another big stakeholder in the gap, also have proposed building a plant in the region to process gas reserves.

Revenues from the Timor Gap are estimated to eventually reach some US$11 billion based on reserves of 30 million barrels of oil and 175 million barrels of liquefied petroleum gas as well as plentiful supplies of condensate and natural gas.

``This revenue stream could contribute very significantly to development of East Timor and the well being of the East Timorese people,'' Brereton said.

Brereton also called for the Howard government to begin preliminary discussions with exiled East Timorese resistance leader Jose Ramos Horta and jailed guerrilla leader Xanana Gusmao on possible future arrangements for the Zone of Cooperation.

The East Timor resistance has said it would be prepared to negotiate with the Australian government and individual companies on oil exploitation rights for the Timor Gap.

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