Foreign Minister Lord Downer re-opened talks in Dili yesterday over the Timor Sea oil and gas riches, reports The Australian.
Some would see it as an attempt to bully the East Timorese into
accepting Australia’s generous offer in this latest round of seabed
boundary negotiations between East Timor and Australia.

“What we
have at the moment,” says Downer, “is what’s called a joint development
area between Australia and East Timor and we give East Timor 90% of the
revenue from that.” And: “If you drew a median line, they may end up
with a good deal less than 90%”.

But the foreign minister failed
to mentioned that the three main oil and gas fields in question –
Bayu-Undan, Greater Sunrise and Laminara/Corralina – lie north of the
median line. The three oil and gas fields have total reserves of 3.3
billion barrels of oil equivalent (BOE) – Bayu Undan 1.05 billion BOE;
Greater Sunrise 2.05 billion BOE; and Laminara/Corralina 0.2 billion

Under the current agreement, East Timor is getting less
than 40% of the oil and gas revenue: 90% of Bayu Undan; 18% of Greater
Sunrise, and no revenue from Laminara/Corralina. East Timor is missing
out on the downstream benefits worth millions of dollars and thousands
of jobs because the gas will be piped to Darwin instead of East Timor.
Downer also failed to mentioned that the southern boundary of the Joint
Petroleum Development Area (JPDA) is based on the median line. And
Australia concluded a water column boundary with Indonesia in 1996
based on that very median line.

Downer doesn’t want a permanent
boundary with East Timor because it would “unravel all of our maritime
boundaries which have been laboriously negotiated over many years with
all of our neighbours”. He says: “If we can find a suitable settlement
that keeps our principles intact but ensures East Timor gets a steady
flow of revenue then there should be honour on all sides”.

wants a creative solution that includes East Timor getting an
additional one-off $3 billion in aid – now increased to $4 billion in
return for East Timor delaying its boundary claims for 50-99 years. He
should realise by now that you can fool all of the people some of the
time, some of the people all of the time, but you can’t fool all of the
people all of the time.

The East Timorese have woken up to this
and will be taking Lord Downer’s latest offers with a grain of salt. If
Downer is serious about an honourable creative solution, he should at
the very least offer to expand the eastern lateral boundary of the JPDA
to include all of Greater Sunrise and the western lateral boundary to
include Laminara/Corralina. All the oil and gas reserve in the new
expanded JPDA, including future finds, could than be shared between
East Timor and Australia using a new formula: 70:30 or 60:40 in favour
of East Timor. The boundary could than be set aside for 50 years. By
then the reserves would have been depleted.

Wouldn’t that be a more realistic and creative solution?

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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