Australia denies Timor oil treaty revoked by RI

Australia denies Timor oil treaty revoked by RI

CANBERRA, Australia (AFP): Indonesia's suspension of naval
exercises off East Timor did not amount to a suspension of the
Timor Gap oil treaty with Australia, Foreign Minister Alexander
Downer said Thursday.

The oil-rich Timor Gap lies off East Timor's south coast.
Under the treaty Australia and Indonesia share oil revenue from
the Timor Sea.

Reports from Jakarta this week said Indonesia had frozen the
Timor Gap treaty because of a serious downturn in relations
between the two countries over East Timor.

But Downer insisted the treaty between Indonesia and Australia
was still valid.

"Indonesia has not suspended or frozen the Timor Gap Treaty,"
he told parliament.

The suspension of naval exercises and patrols by Indonesia in
the zone had absolutely no link to the Timor Gap Treaty, Downer
said.

"The activities under the Timor Gap Treaty are exploration for
and production of petroleum resources. And those activities are
still continuing and will continue even when East Timor separates
from Indonesia."

Downer said the Australian government was now developing a
transitional strategy for the shift of sovereignty over the gap
from Indonesia to East Timor.

Australian officials said this week they had begun talks with
East Timorese leaders over the Timor Gap treaty.

An Australian-led multinational security force is now working
to restore stability in the territory ravaged by an Indonesian-
backed terror campaign since it opted for independence in its
August 30 ballot.

Australia's leading of the force and its criticism of human
rights abuses in the territory have prompted fierce accusations
of betrayal in Indonesia and Foreign Minister Ali Alatas has
dubbed relations between the two countries as being at an all-
time low.

Resistance leader Xanana Gusmao, who announced Thursday he
would be returning to East Timor next week, told businessmen in
Melbourne on Monday that oil would be among its major exports
when it becomes independent.

The Indonesian government said on September 7 that it was
fully prepared to cancel the treaty signed in 1989 with Australia
over oil and gas extraction rights in the sea between Timor and
Australia.

"That treaty was between the government of Indonesia and
Australia, but because East Timor will in the future no longer be
Indonesian territory, for legal reasons, that treaty can no
longer be implemented," Mines and Energy Minister Kuntoro
Mangkusubroto said.

The area in the Timor Sea covered by the treaty is believed to
hold hydrocarbon reserves worth some US$8billion but only around
$1.1 million worth of oil and gas was drawn from it last year.