FinTimes: ET demands oil money

BACK DOOR Newsletter on East Timor home

"They [Australia] should say to East Timor, here's the oil, it's yours, take it," Jose Ramos Horta, East Timor foreign minister and Nobel peace laureate

Financial Times

January 26 2001

E Timor demands oil money

By Tom McCawley in Jakarta

East Timor on Thursday called on Australia to hand over all of the revenues under the Timor Gap oil and gas treaty. "They [Australia] should say to East Timor, here's the oil, it's yours, take it," Jose Ramos Horta, foreign minister and Nobel peace laureate told the Financial Times.

East Timor, under a United Nations transitional government, is renegotiating the Timor Gap treaty signed between Indonesia and Australia in 1989. In negotiations, East Timorese officials have been requesting a 90-10 split of oil and gas revenues with Australia, for fields under East Timor's jurisdiction.

Revenue from the Timor Gap oil and gas fields is expected to reach around $5m in 2001, says the government, but could rise to $100 m by 2010. East Timor's budget for 2000 was $4.5m. Some estimates put total oil and gas reserves under the Timor sea at 500m barrels of oil, worth more than $17bn at current prices.

Mr Ramos Horta said he was confident Australia would be sympathetic to East Timor's requests, describing John Howard, Australian prime minister, and Alexander Downer, Australian foreign minister as "more generous than Mother Theresa."

Peter Galbraith, minister for political affairs and the Timor Sea in East Timor's cabinet, said that "the UN considers the '89 treaty illegal and invalid."

East Timor voted for independence in a UN-sponsored ballot in 1999 after a brutal 24-year military occupation by Indonesia. Indonesia's occupation of East Timor was never recognised under Indonesian law, rendering the 1989 Timor Gap contract open to renegotiation.