Australia Fails Fairness Test for East Timor

Complex Trade Agreement with U.S. Undermines Australia's Claim on Timor Boundary Talks

For Immediate Release

Contact: John M. Miller, 718-596-7668; 917-690-4391

May 17, 2004 - On the eve of the signing of a free trade pact between the U.S. and Australia, the East Timor Action Network (ETAN) urged Australia to speed up it its negotiations with East Timor on a permanent maritime boundary.

Trade representatives from both countries plan to sign the Australia-U.S. Free Trade Agreement (AUSFTA) in Washington Tuesday.

"If Australia can negotiate a complex agreement of hundreds of pages in under a year, surely it can accelerate its talks with East Timor over their maritime boundary," said John M. Miller, spokesperson for ETAN.

"Australia's claim that it cannot meet more than twice a year on the boundary is absurd. Delimiting the East Timor-Australia boundary according to current international law should not take long," added Miller. "In the 1970s, Australia negotiated far longer and more difficult maritime boundaries with Indonesia in just 2-1/2 years."

Australian and East Timorese officials held their first formal negotiating session in April, nearly two years after East Timor called for talks.

"The US$1 million a day Australia is illegally taking from the Laminaria-Corallina oil field is certainly a lucrative motive for stalling," added Miller.

"Australia's withdrawal from international dispute resolution mechanisms on boundary disputes should give pause. One wonders whether Australia will withdraw from the AUSFTA's resolution mechanisms if it fears it won't get its way," said Miller.

see Timor Sea, Boundaries & Oil pages

Background

Negotiations on the Australia-U.S. Free Trade Agreement began on March 17, 2003, and the completed agreement was announced on February 8. Either country can withdraw from the agreement with six months written notification.

Substantial oil and natural gas deposits lie under the Timor Sea between Australia and East Timor. The fate of tens of billions of dollars of revenue depend on a permanent boundary agreement.

East Timor, which became an independent nation in May 2002, has never had maritime boundaries.

In October 2002, East Timor enacted a Maritime Boundary Law, claiming a 200 nautical mile Exclusive Economic Zone in all directions, based on the United Nations Convention on the Law of the Sea. Where neighboring claims overlap, as is the case with East Timor and Australia, countries must negotiate a permanent maritime boundary, usually halfway between their coastlines.

In March 2002, Australia officially withdrew from international legal mechanisms to resolve boundary issues that cannot be settled by negotiation -- the International Court of Justice and the 1982 UNCLOS Tribunal. These actions left the soon-to-be-independent East Timor with no legal mechanism to establish its boundaries in the absence of cooperative negotiations from Australia.

The Laminaria-Corallina oil field is mostly depleted after generating more than (US) $1 billion in revenues for the Australian government since 1999; none of this revenue has gone to East Timor. If the Australian government continues to delay a permanent maritime boundary for decades, they will have taken 60% of East Timor's entire oil and gas entitlement.

East Timor has protested Australia's recent issuance of new exploration licenses in the disputed Greater Sunrise gas field, the most lucrative of all known fields on East Timor's side of the median line.

Last March, 53 members of Congress called on Australia to "move seriously and expeditiously in negotiations with East Timor to establish a fair, permanent maritime boundary and an equitable sharing of oil and gas resources in the Timor Sea." The Senate Appropriations Committee has urged "both governments to engage in good faith negotiations to resolve their maritime boundary expeditiously in accordance with international legal principles."

East Timor is among the poorest of the world's countries, suffering from very low levels of basic services and high unemployment. East Timor is currently struggling not to go into debt to international financial institutions, as it needs to cover a (US)$126 million budgetary financing gap between 2005 and 2007.

"A boundary determined in accordance with established principles of international law as embodied in the United Nations Convention on the Law of the Sea and as spelled out in decisions of the International Court of Justice would triple the income of our country," East Timor's Prime Minister Mari Alkatiri said at the opening of the April talks. "For us, a twenty year negotiation is not an option. Timor-Leste loses one million dollars a day due to Australia's unlawful exploitation of resources in the disputed area. That is too many lost and wasted lives."

The East Timor Action Network/U.S. supports human dignity for the people of East Timor by advocating for democracy; sustainable development; social, legal and economic justice; and human rights, including women's rights.

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