Spat could delay Timor oil deal

Spat could delay Timor oil deal

Australian Foreign Minister Alexander Downer admitted Wednesday differences with East Timor over the revenue share-out from lucrative oil and gas reserves in the Timor Sea could delay a treaty.

A Timor Gap arrangement was expected to be converted into a treaty on May 20, the day East Timor becomes an independent nation.

But East Timor Chief Minister Mari Alkatiri cast doubt on this arrangement last week, saying Australia had committed an unfriendly act towards his country during negotiations over rights to oil and gas reserves.

Downer admitted the dispute could delay the signing of the treaty.

"It is possible," Downer said in Sydney. "But I think we ought to try to get these negotiations concluded before May 20. They are technical differences and we are certainly not getting into the negotiations in public."

Alkatiri claimed last week that Australia had unilaterally withdrawn from negotiations in the International Court of Justice to resolve a dispute over maritime boundaries, which would in turn affect East Timor's share from the lucrative Greater Sunrise field.

Under an arrangement agreed in July, 90 percent of royalties from the joint production area goes to East Timor and 10 percent to Australia.

But only around 20 percent of Greater Sunrise falls within the joint production area and 80 percent lies in Australia's area, so East Timor would receive only 18 percent of royalties from the Greater Sunrise output. -- AFP