The East Timor Transitional Cabinet this afternoon endorsed the Arrangement on the Timor Sea, which has been negotiated between the Transitional Administration, on behalf of East Timor, and the Government of Australia, since March 2000.
“This is a good agreement for East Timor, but it is also the starting point of good co-operation between East Timor and Australia at all levels,” said Cabinet Member for Economic Affairs Mari Alkatiri, one of the lead negotiators of the agreement, after the Cabinet meeting.
Before coming into force, the Arrangement must be approved by the elected government of East Timor in accordance with its Constitutional processes.
“This is the very first time the United Nations has participated in negotiating a treaty on behalf of a country. It will be up to the new elected Government of East Timor to decide whether it wants the treaty or not. I believe it is a good treaty, I think it is to the advantage of East Timor and so my recommendation would be that East Timor agree its terms,” Cabinet Member for Political Affairs and Timor Sea Peter Galbraith, Alkatiri’s co-negotiator, said today.
“East Timor will have to work in the coming months to devise a new fiscal regime for the area, as is its sovereign right, and that regime will have to balance the need of the East Timorese people for revenue and the need to have an environment that will encourage the oil companies to make investments,” Galbraith added.
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9-11 APPEA: Galbraith: Timor Sea Petroleum keynote conference
address added May 5
"I am here today with Dr. Mari Alkatiri, East Timor’s Minister for Economic Affairs and therefore my colleague in Cabinet, to bring you a simple message: the period of instability and uncertainty in East Timor is over. East Timor’s future status is settled: when the UN Administration ends, East Timor will be the 21st century’s first new state. ... Although completely devastated by 24 years of brutal occupation, and the graceless, destructive and murderous exit of the Indonesian authorities in September 1999, East Timor is well on its way to establishing stable democratic institutions and sensible pro-market economic policies. ... By achieving independence so late, East Timor has had the chance to study the experience of other developing and developed countries as they develop their oil and gas industries. East Timor has seen the mistakes others have made and is determined to avoid them. East Timor understands that oil and gas investments are made for thirty years. Investors require stability and certainty with regard to government policies. ... On behalf of the East Timor Cabinet and legislature, I am here to underline our intention to develop and implement a transparent, stable fiscal and regulatory regime that will be amongst the most modern in the world, and which will enable both the companies and the East Timorese to profit from our resource. ...
Both East Timor and Australia, and in particular its Northern Territory, have a lot to gain by concluding a Treaty to facilitate the development of the vast oil and gas resources of the Timor Sea. Like any negotiation, this requires compromises. East Timor recognises that resolving the issue of sovereignty in the Timor Sea – making a seabed delimitation -- is difficult for Australia, and certainly will be very time consuming. East Timor is therefore prepared to enter an interim agreement provided it has the same -or nearly the same- economic benefits as if there were an actual maritime delimitation done in accordance with international law. ... Neither Mari Alkatiri nor I can bring back East Timor a treaty that would give East Timor less economic benefit than that which it is entitled under international law. ...
In summary, we see a great opportunity for East Timor and Australia in the Timor Sea. With East Timor the petroleum industry has a partner that promises a reliable, stable, and exploitation-friendly future. The uncertainty about East Timor’s future is over and we promise a regulatory regime that is transparent, straightforward, and honest."
Ambassador Peter Galbraith, Cabinet Member for Political Affairs and Timor Sea, East Timor Transitional Government