Statoil holds ground on E. Timor oil deal

Statoil holds ground on E. Timor oil deal

OSLO (AFP): Norway's state-owned oil company Statoil is not concerned by Portuguese allegations that its planned activities off the coast of East Timor are illegal, Statoil representatives said yesterday.

Portuguese Prime Minister Antonio Guterres is expected to raise the issue of Statoil's activities in a "contested" region with his Norwegian colleague Thorbjoern Jagland in talks due today.

Norwegian authorities have as yet not been officially informed about Statoil's oil and gas prospecting off East Timor, in a joint venture with the U.S Mobil Company, working from Australia.

"We have not been formally contacted by Portugal in this case, and we have not been looking into any legal aspects of this deal," Norwegian foreign ministry spokesman Ingvard Havnen said yesterday.

"Any protest against a future Statoil activity in the area must be directed against the deal made by Indonesia and Australia in which the two independent states have set up a joint administration in sharing tax incomes from any oil and gas finds," Statoil information director Lars Gunnar Dahle said in a comment.

Dahle added that an agreement for sharing tax income was made after oil and gas was found west of the "grey zone" in the Timorese Sea.

"From a Statoil point of view, we take it for granted that all formalities in connection with this agreement are in order. But we know that Portugal has never relinquished its administrative rights over East Timor," Dahle said.

Statoil plans to start oil and gas prospecting in the Timorese Sea next year.

"We know that there might be future changes in the off-shore border lines, but Statoil will stick to all deals being made," Dahle said.

Guterres is expected to discuss the Statoil issue during his talks with Jagland on Tuesday morning.