Australian lawmakers to approve Timor Sea gas deal

Australian lawmakers to approve Timor Sea gas deal

Rod McGuirk, Associated Press, Canberra, Australia

Australian lawmakers on Wednesday were expected to approve
legislation paving the way for Australia and East Timor to carve
up a gas and oil field, a deal minor political parties say short
changes one of the world's poorest nations.

Under the deal, Australia will take about 80 percent and East
Timor 20 percent of royalties from the Greater Sunrise field,
which some analysts say could contain up to A$40 billion (US$30
billion) worth of gas and oil.

Opposition lawmakers say that is unfair to the impoverished
fledgling nation.

"What a terrible, terrible situation," an emotional Green
Party leader Bob Brown said in Parliament. "If I feel angry about
it, how must the East Timorese feel?"

But the legislation appeared certain to become law after the
opposition Labor Party agreed to support it.

The Australian government and newly independent East Timor
struck the revenue sharing deal last year, based on a maritime
border between the two neighbors which was drawn by Australia and
East Timor's former ruler, Indonesia, in the 1970s.

That border placed 80 percent of Sunrise exclusively in
Australia's hands and 20 percent in a joint development zone
shared between the two countries under a treaty.

East Timor disputes that border and has begun negotiating with
Australia for a new one that delivers more of Sunrise and, with
it, a larger share of its royalties. It agreed to the revenue
sharing deal as a way of getting money quickly from the gas
reserves while drawn-out maritime border negotiations continue.

But even now the East Timorese Parliament has yet to ratify
the revenue deal.

East Timorese Prime Minister Mari Alkatiri has accused
Australia of delaying border negotiations while continuing to
issue mineral exploration licenses around Sunrise and that
Australia's continued claims to 80 percent of Sunrise "undermine
prospects for its (the royalty deal's) approval."

Members of the U.S. Congress have joined in East Timor's
criticism of Australia.

Barney Frank, Democratic congressman from Massachusetts, along
with 53 colleagues, wrote to Australian Prime Minister John
Howard criticizing his government for failing to give a time
frame to settle the boundary.

The U.S. lawmakers wrote: "Given the overlapping claims of the
two countries, we would strongly hope that any revenue from
disputed areas be held in escrow until a permanent boundary is
established."

The Australian Parliament on Wednesday rejected an amendment
proposed by a minor party, the Australian Democrats, that would
have forced the government to hold in trust any tax revenue
generated by Sunrise until permanent boundaries are determined.

Government Cabinet minister Eric Abetz defended as reasonable
Australia's plan to negotiate with East Timor on the new border
once every six months.

Alkatiri, who maintains East Timor is entitled to all of
Sunrise under international law, wants the meetings to be held
monthly.

"While delaying on negotiations, Australia has issued new
licenses in disputed areas near Sunrise and is continuing to
derive revenues from other disputed parts of the Timor Sea," he
said in a statement quoted in Parliament.