Contributed by Jim Hayes

The Australian government bullying our small neighbour East Timor, over oil and gas reserves found near the new country’s coastline.

An attempt to impose processing of these resources in Darwin and an 80/20 split is angering East Timor.

This is expressed in a letter from chief negotiator Xanana Gusmao, who has accused Australia of colluding with oil companies, Woodside Petroleum and Conoco Philips, to ensure that the oil and gas goes to Darwin, instead of to a processing facility in East Timor.

By Doing this, Australia is  denying the young country the capacity, to take full advantage of its only major resource, as a means of building its economy. Being able to set up a processing plant would establish a hub that will create economic links and provide tens of billions of needed export income to invest in infrastructure, economic development and the creation of jobs, as well as provide the ability to spend on education, health and knowledge transfer.

Processing the oil and gas in Darwin will mean that much of this will not be possible, because the purpose is to minimise what the oil companies have to pay.

East Timor is not only insisting on the right to carry out the processing, but for t a 70/30 split as the bottom line.

“Australia’s offer may appear generous [but]…it amounts to around a week’s worth of revenue,” Mr Gusmao wrote.

Australia will take a potential $25 billion, which the letter says, rightfully belongs to East Timor.

The Letter  criticises the Conciliation Commission, saying the technical experts knew nothing about East Timor and describing their assessment as “shockingly superficial” and advantaging Australia.

Australia’s claim to the oil and gas, is based on a treaty signed with Indonesia in 1989, during the time of its military occupation. A consequence is that Australia has not recognised East Timor’s maritime borders and regards resources within them to be open to exploitation.

On this basis, Australia used its muscle on the new nation that came into existence in 2002 and imposed the Timor Sea Treaty in 2006. under this treaty,  there is no commitment to recognise a permanent maritime border and Australia claims fifty percent ownership of the resources in the Greater Sunrise field.

At this time, further negotiation is stalled. The bottom line for East Timor is that the oil and gas is piped to East Timor.

East Timor is doing all it can to fight back and not allow itself to be bullied into submission.

This is far from over yet.