E. Timor to control Timor Sea oil?

E. Timor to control Timor Sea oil?

CANBERRA (AP): The Australian government was under pressure Wednesday to take a hard line against what some lawmakers describe as efforts by East Timor to take full control of lucrative oil fields under the sea separating the two countries.

Northern Territory Chief Minister Denis Burke and Resources Minister Daryl Manzie were in Canberra for meetings with federal Foreign Affairs Minister Alexander Downer to air fears that the United Nations Transitional Authority in East Timor, or UNTAET, is pushing to gain control of all Australian assets in the Timor Sea.

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.

UNTAET is negotiating a new treaty with Australia on behalf of East Timor, and Australian media reports Wednesday suggested that Canberra was prepared to give Dili 80 percent of the reserves.

The Northern Territory government's fears are based on recent comments by UNTAET's Cabinet Member for Political Affairs and Timor Sea, Peter Galbraith, who maintains that if international law were upheld, East Timor would gain full control of the resources in a cooperation zone that currently splits them equally.

Manzie and Burke say the Northern Territory economy is a significant beneficiary of the Timor Sea oil fields. They fear Dili may be handed control of a planned A$5 billion pipeline from the Bayu Undan gas fields to Darwin.

Oil and natural gas are expected to develop into an important source of income for cash-strapped East Timor along with coffee exports and, in the future, tourism.

Australian Industry Minister Nick Minchin said last week that the Australian government was willing to make significant concessions to reach an agreement with East Timor.

"We've indicated that we are prepared to move well away from the current 50-50 split in favor of East Timor," Minchin said.