Production accords for Timor Sea may change<\/p>\n
CANBERRA (Bloomberg): Australian oil and gas companies could
\nbe forced to renegotiate their production agreements in the Timor
\nSea if Indonesia provides any form of autonomy for East Timor, an
\nindustry executive said.<\/p>\n
Australia's opposition Labor Party has said it plans to
\nsupport self-determination for the Indonesian province if it
\nwins government in the Oct. 3 national election.<\/p>\n
\"If (East Timor) took on all the obligations that Indonesia
\ntakes on, the situation in the Timor Gap would be unchanged,\"
\nsaid Barry Jones, executive director of Australian Petroleum
\nProduction and Exploration Association.<\/p>\n
\"If they said they were abolishing the treaty, then you'd go
\nback to negotiating.\"<\/p>\n
Any form of autonomy for East Timor would affect the Timor
\nSea \"zone of cooperation\" providing for shared oil revenue from
\nthe fields which lie between the province and Australia's north
\ncoast.<\/p>\n
Australia negotiated the agreement with Indonesia in 1989 as
\npart of the Timor Gap treaty which might no longer be legally
\nbinding.<\/p>\n
Labor, neck and neck with the incumbent Liberal-National
\ncoalition in the latest opinion polls, has said it will negotiate
\na new treaty with East Timor if that happens.<\/p>\n
\"The Timor Gap treaty is between Indonesia and Australia but
\nthere's nothing that... would be an obstacle to East Timor
\nstanding in the shoes of Indonesia,\" the Labor Party's spokesman
\nfor foreign affairs, Laurie Brereton, said Thursday.<\/p>\n
Australian resources and energy companies such as Broken Hill
\nProprietary Ltd. and Santos Ltd. have developed oil and gas
\nfields in the Timor Sea, including the Bayu Undan and Elang
\nKakatua projects.<\/p>\n
Change of Heart<\/p>\n
Australia's Labor government under Gough Whitlam was seen to
\ncondone East Timor's integration into Indonesia in the 1970s, and
\nAustralia was the first country to legally recognize Indonesia's
\nincorporation of the former Portuguese territory.<\/p>\n
Petroz NL, a medium-sized Australian oil and gas company with
\na stake in both Bayu Undan and Elang Kakatua, is keeping a close
\neye on political developments in Indonesia and Timor. Still,
\nManaging Director Rod Brown says he's not concerned.<\/p>\n
\"I don't think it will impact on oil and gas companies,\"
\nBrown said. \"I'd be surprised if the terms of the treaty were
\ndifferent with East Timor.\"<\/p>\n
Under the Timor Gap Treaty, revenue from those projects is
\nshared with the Indonesian government. East Timor was integrated
\ninto Indonesia in 1976, and Indonesia has indicated it will allow
\nautonomy in the province, though not on economic or defense
\nmatters.<\/p>\n
Analyst Paul Ashby at ABN Amro said Indonesia isn't likely to
\ngrant independence for East Timor anytime soon.<\/p>\n
\"Indonesia is in a lot of trouble economically and there's a
\nlot of revenue going to come spinning out of that region in the
\nnext ten years,\" he said. \"I don't think Indonesia is likely to
\ngive up one dollar of that to Timor.\"<\/p>",
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