Australia and Indonesia sued over Timor Gap

Australia and Indonesia sued over Timor Gap

SYDNEY (AFX): PetroTimor has launched legal action against the Australian and Indonesian governments and Phillips Petroleum over a disputed exploration concession covering part of the Timor Gap treaty zone, The Sydney Morning Herald reported without identifying its source.

The report said PetroTimor, a Colorado-based group owned by Oceanic Exploration and the East Timor government, is seeking up to A$2.85 billion (about US$1.58 billion) in damages in an action launched in the Australian Federal Court.

The company claims the Australian and Indonesian governments formed an illegal agreement when they signed the Timor Gap Treaty, under which they reached a revenue sharing agreement for the middle portion of the Timor Sea, in 1989, the report said.

The company is seeking official recognition of a concession it was granted over the same area by Portugal before Indonesia invaded East Timor in 1975, the report said.

The report said an Australian government spokesperson said the government would "vigorously" defend any claim bought against it, while a Phillips Petroleum spokesperson said the company was confident its exploration and production contracts for the area were legally valid.