Aussies resolve big differences with E. Timor

Aussies resolve big differences with E. Timor

DARWIN, Australia (AP): The government said Friday that it has resolved major differences with East Timor over how best to divide control of lucrative oil fields under the sea separating the two countries.

Foreign Minister Alexander Downer predicted a framework agreement for a new Timor Gap Treaty between Australia and East Timor would be reached by the June deadline demanded by prospective gas field developer Phillips Petroleum.

Negotiations between the two countries are due to resume in Dili next week.

"The differences between us now are pretty narrow - they're really just some final calculations that need to be made and then negotiations over questions of royalties and revenue," Downer told the Australian Broadcasting Corp.

"But some of the broader and more profound difficult questions have been resolved."

The Timor Sea petroleum and gas reserves were originally carved up under a treaty Canberra negotiated with Indonesia in the 1980s and early 1990s. Indonesia gave up its place in the treaty after East Timor voted for independence in 1999.

The United Nations Transitional Authority in East Timor (UNTAET) is negotiating a new treaty with Australia on behalf of the fledgling nation. It is seeking the majority share of the oil and gas fields, which were split 50-50 in the original 1989 treaty.

Downer confirmed Friday that Australia was prepared to concede the majority of the assets to cash-strapped East Timor, but would not comment on reports Dili's share could be as much as 90 percent.

"If we give them a much bigger share of the revenue, well, that's going to mean a great deal to them whereas the sacrifice for us is really not very much," he said.