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.