Australia's Oil Grab (East Timor)

by Jon Lamb

Multinational Monitor, March/April 2005


"We went to East Timor to help those people, and now we are slapping them in the face and stealing their oil."

This is what Chip Henriss-Anderssen, a former major in the Australian military who served with the International Force for East Timor, told reporters on March 7. "We thought we were doing something decent. Now we have to ask the very real question of whether or not we went to East Timor to secure oil assets that aren't ours."

The latest round of talks between Australia and East Timor in Canberra on disputed oil and gas fields in the Timor Sea took place March 7-9, but concluded with little more than an announcement that further talks will take place soon.

Just prior to the talks, a foreign affairs and trade department official told reporters in Canberra that the Australian coalition government was prepared to hold out for up to 99 years - referring to a "Hong Kong" scenario if the government of East Timor maintained its demand that the maritime boundaries be settled according to international law.

Two months before East Timor gained independence, Australia withdrew recognition of the maritime boundary jurisdiction of the International Court of justice, leaving East Timor with no legal avenue to contest the current boundary dispute.

At the center of discussions is the Greater Sunrise gas field, the largest known reserve of gas in the Timor Sea. Negotiations stalled last year after the October federal election, when the East Timorese government refused to accept the terms on offer for a "creative solution" regarding Greater Sunrise.

The Australian government has reportedly made an offer of $2.4 billion to $4 billion (over 30 years) to East Timor if it drops the demand for a royalty share greater than 18 percent. Australian negotiators are arguing that this new "creative solution" should be concluded separate to finalizing the maritime boundaries, hence the threat to hold out for decades if East Timor does not relinquish its claims.

While the estimates of the wealth expected to be generated from Greater Sunrise vary, based on current world prices the total government take from royalties is likely to be on the order of $30 billion. The Australian government appears to hope that cash-strapped East Timor will accept.

A delegation of prominent Australian supporters of East Timor, including Greens Senator Bob Brown, Bishop Hilton Deakin and businessperson Ian Melrose, gathered in Canberra outside the venue of the talks on March 7 and condemned the Australian government's stance.

According to Bishop Hilton Deakin, "The majority of Australians want our government to offer a fair deal that reflects East Timor's rightful entitlement under current international law."

Melrose has vowed to spend more than $4.5 million on a media campaign in support of East Timor's claims, "if I don't think it's getting the momentum required."

Many former Australian military personnel, including Second World War veterans who were stationed in Timor, have spoken out in support of East Timor's rights.

A letter signed by 17 U.S. senators and representatives was also recently sent to Prime Minister John Howard, calling for "Australia to move quickly and seriously to establish a fair, permanent maritime boundary with Timor-Leste."

The letter said: "An equitable sharing of oil and gas revenues would enable Timor-Leste to provide better healthcare and other essential services to its citizens. Such equitable sharing of revenue is not a question of charity; rather it is a matter of self-determination, sovereignty and Timor-Leste's future."

"Unless the Australian government acknowledges East Timor's legal entitlements under current international law and stops trying to shortchange the East Timorese people," says Tom Clarke, coordinator of the Timor Sea Justice Campaign in Melbourne, "future negotiations are not going to result in a just and fair outcome."

"The East Timorese resisted a brutal occupation for 24 long years. Why would they give up on their struggle for self-determination for a one-off payment that falls well short of what East Timor is legally entitled to?"

Clarke claims the Howard government is ignoring international law "so it can take billions of dollars from one of the poorest nations in the world. East Timorese children are dying from preventable diseases and the Australian government is taking $1 million a day of contested oil royalties. It's bringing shame to all Australians."


Third World Network Features/Green Left Weekly. This article appeared initially in Green Left Weekly, March 16, 2005.

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