Australia stands by Timor gap treaty

Australia stands by Timor gap treaty

CANBERRA (Dow Jones): The Australian government has dismissed calls for a review of a Timor Gap treaty with Indonesia, which allows the two nations to jointly exploit petroleum resources in the area, in the wake of Australia's decision to advocate self- determination for East Timor.

Australia's opposition Labor Party Wednesday urged the ruling Liberal-National coalition to ensure East Timor receives Indonesian revenue from the Timor Gap fields.

But Trade Minister Tim Fischer said it's premature to talk about changes to the Timor Gap treaty.

The existing treaty would remain in force and there is no question of a change of Australia's view that Indonesia maintains sovereignty over East Timor, he said.

"This is absolutely premature," Fischer said, according to a report by Australian Associated Press, a domestic news agency.

Australia and Indonesia signed the treaty in December 1989, clearing the way for exploration and development of the rich oil and gas fields in the Timor Sea, between Australia's north coast and East Timor. Under the agreement, tax revenue from production in the so-called zone of cooperation is shared equally between Indonesia and Australia.

Broken Hill Proprietary Co. (BHP) is the largest acreage holder in the zone of cooperation. The area is to host both BHP's planned 32,500-barrel-a-day Elang-Kakatua oil field, and its Bayu-Undan gas condensate discovery.

Earlier this week, Foreign Affairs Minister Alexander Downer unveiled a fundamental shift in policy toward East Timor, with Australia now backing autonomy for the disputed province, followed by an act of self-determination.