After a border dispute and spying scandal, can Australia and Timor-Leste be good neighbours?



Protesters outside the Australian embassy in Dili, Timor-Leste, in 2016, demanding a settlement of the border dispute between the nations.
Antonio Dasiparu/EPA

Michael Leach, Swinburne University of Technology

On August 30, Timor-Leste will celebrate the referendum that gave it independence from Indonesia. For the people of this small island, it has been a long battle – and one that continues today. You can read our companion story on the island nation’s struggle for independence here.


This Friday marks the 20-year anniversary of the day the East Timorese people voted overwhelmingly for independence from Indonesia after a 24-year occupation.

Another significant anniversary comes next month, on September 20. That was the day of the arrival of the INTERFET mission, the Australian-led multinational force that brought an end to the violence that wracked Timor-Leste after the independence vote.

In the intervening three weeks, 1,500 Timorese were killed in the violence, which had been orchestrated by the Indonesian military and its proxy militias. Over 250,000 were forcibly displaced to West Timor and some 80% of the infrastructure was destroyed.

Many Australians are rightly proud of their contribution to Timor-Leste’s independence, which served as a historical corrective to Australia’s longstanding support for Indonesian’s invasion and forced integration of East Timor in 1975-76. The more than 5,000 Australian soldiers in the INTERFET mission marked the nation’s largest military deployment since the Vietnam War.

Yet despite the goodwill the mission engendered in Timor-Leste for the Australian people, relations between the two nations have repeatedly been undermined by contentious negotiations over control of the lucrative oil and gas fields in the Timor Sea.




Read more:
Australia and Timor Leste settle maritime boundary after 45 years of bickering


A treaty signed last March created a maritime boundary between the states for the first time. The border is expected to come into force this week following its ratification by both parliaments – another momentous milestone in Timor-Leste’s history.

But other thorny issues remain. When Prime Minister Scott Morrison arrives in Dili for the anniversary on Friday, he will likely face calls for Australia to drop its prosecution of a whistleblower who revealed an Australian spying operation against Timor-Leste.

As former Timor-Leste leader Jose Ramos Horta said,

If Australia doesn’t show political leadership, moral leadership on this issue, every time we talk to Australian leaders I will wonder if they have a tape recorder in their pocket [or] if my office has been bugged.

Australian soldiers conducting an operation to flush out militia fighters in Timor-Leste in September, 1999.
Jon Hargest/AAP

Conflict over oil and gas

Since its independence, Timor-Leste’s relations with Australia have been overshadowed by one major factor: the oil and gas fields on its contested maritime border.

Relations hit rocky waters in 2012 when Timor-Leste challenged the Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS), which had been signed by the two countries in 2006. This treaty had established a 50-year moratorium on maritime boundary negotiations, or five years after exploitation of the Greater Sunrise gas field ended, whichever occurred first.

Allegations then emerged in 2013 from a former ASIS agent (now known as Witness K) that Australia had spied on Timorese officials during the negotiations over the CMATS treaty. This led Timor-Leste to launch a case in The Hague challenging the treaty for want of good faith.

Australia was embarrassed by the exposure, but determined to maintain the countries’ ongoing treaty arrangements and focus instead on revenue-sharing agreements. However, Timor-Leste argued that the bulk of the oil and gas fields in the Timor Sea would lie on their side of a median line and pushed for a permanent boundary to be drawn between the countries.




Read more:
Australia and Timor Leste reach a deal on the Timor Sea – but much remains unknown


As relations deteriorated, ministerial visits ceased for almost five years.

Because Australia had abandoned the international courts as a means of resolving the maritime boundary in 2002, Timor-Leste had only one option left. In 2016, it pioneered the use of the UN Convention on the Law of the Sea (UNCLOS) compulsory conciliation process: a non-binding but mandatory mediation between nations on maritime disputes.

The conciliation panel of five judges found the CMATS treaty’s moratorium on defining a maritime boundary was invalid. This dealt a fatal blow to decades of Australian foreign policy focused on maintaining its continental shelf claim in the Timor Gap in line with the 1972 Australia-Indonesia border treaty.

Australia could have attempted to tough it out since the tribunal’s finding was non-binding. But by this point, the Labor opposition was arguing the maritime boundary with Timor-Leste should be renegotiated in line with international law, putting additional pressure on the government to resolve the dispute.

A separate dispute over China’s claims in the South China Sea, also settled in 2016, made Australia’s position increasingly untenable, as well. The world was urging China to respect an international tribunal’s maritime ruling, so it would be difficult for Australia not to do the same.

A new boundary finally set in the sea

Once the UNCLOS opening decision came down, the two sides began negotiating a border in good faith. Timor-Leste dropped its espionage case against Australia in the Permanent Court of Arbitration in The Hague, and later terminated the CMATS treaty, without Australian objection.

Announcement of the new maritime border treaty followed in March 2018. It was a major diplomatic breakthrough and soon led to the resumption of ministerial visits.

The new maritime boundary between Australia and Timor-Leste.
Department of Foreign Affairs and Trade

The treaty created a median-line boundary in the former Timor Gap, placing the wells in the former Joint Petroleum Development Area (JPDA) in Timor-Leste’s sovereign waters.

The Timorese believe there is another A$1.5 billion of oil reserves in this area, but as these fields near the end of their life, the greater game lies in the as-yet-untapped Greater Sunrise field. This field straddles the eastern side of the new boundary and is believed to be worth in excess of US$40 billion.

Timor-Leste also achieved a major increase in royalties from the future development of this field, up from 50% under the CMATS treaty to 70-80%, depending on whether the pipeline eventually goes to Timor or Darwin.




Read more:
For Timor-Leste, another election and hopes for an end to crippling deadlock


China’s potential role in development

Since then, Timor-Leste’s focus has shifted to negotiations with its commercial partners over its ambitious plans for the Tasi Mane oil and gas megaproject on its southern coast.

This project could bring additional challenges for the relationship with Australia. The East Timorese government estimates that external financing will provide some 80% of the estimated US$10.5-12 billion funding for the project. And Timor-Leste’s ambassador to Australia has already stated that if funding partners cannot be found among Timor-Leste’s friends in Australia, the United States, Japan or South Korea, then Chinese capital would be a clear alternative.

Timor-Leste has rejected reports that China’s Exim bank offered a A$16 billion loan to finance the megaproject, though it acknowledges both countries have expressed willingness to cooperate over the separate development of Timor-Leste’s petrochemical industry.

It is also notable that China this month donated some US$3-5 million in defence materiel requested by the Timorese government.

Even though China might be seen as a logical partner for developing Timor-Leste’s oil and gas processing capabilities, Beijing’s involvement would certainly complicate relations with Australia.

Timor-Leste has generally sought to balance its relationships with key regional powers, in part to prevent the dominant influence of any single nation. The country’s foreign minister recently emphasised that discussions on the Tasi Mane project are ongoing with potential partners in Australia, the US, Europe and Asia.

Foreign Minister Julie Bishop meets with her Timor-Leste counterpart, Dionisio Soares, in Dili in 2018. She was the first Australian government minister to visit Timor-Leste in five years.
Greg Roberts/AAP

Remaining obstacles to closer ties

Despite the major improvement in bilateral ties between the two countries, there are some remaining points of contention.

The prosecutions of Witness K and his lawyer Bernard Collaery in the espionage whistleblower case have been criticised by Horta and another former Timor-Leste leader, Xanana Gusmão. This week, Gusmão indicated he would appear as a witness to give evidence on behalf of the two, raising the potential for further embarrassment for Australia.

Some political activists in both Australia and Timor-Leste have also called for Canberra to pay back oil and gas revenues it has received from the JPDA since the border treaty was signed in 2018, and accused Australia of delays in ratification.

While these accusations have made headlines, Timor-Leste’s parliament had not ratified the treaty either until last month. In any case, Timorese NGOs point to the far larger question of up to US$5 billion in revenues that Australia has received dating back to 2002, when revenue-sharing agreements began.

But it appears there is no appetite in either country to consider repayment of historical royalties.

As Australia and Timor-Leste prepare to celebrate the anniversary of the independence referendum – as well as the recent restoration of good bilateral relations – it’s worth keeping in mind that new hurdles potentially lie ahead, with implications for the wider region.The Conversation

Michael Leach, Professor, Politics & International Relations, Swinburne University of Technology

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Twenty years after independence, Timor-Leste continues its epic struggle



original.
AAP/Antonio Dasiparu

Sara Niner, Monash University

On August 30, Timor-Leste will celebrate the referendum that gave it independence from Indonesia. For the people of this small island, it has been a long battle – one that continues today. You can read our companion story on the island nation’s vexed relationship with Australia here.


Indigenous myth attributes the high mountain chain that runs like a spine down the centre of the crocodile-shaped island of Timor to Mother Earth’s dying movements when she retreated underground. This mountain chain is more pronounced in the east, in the territory of Timor-Leste, and often protrudes directly down into the sea along the rugged northern coast.

The island is also surrounded by significant waters. To the south are the vast and disputed oil reserves. To the north is a deep exchange pathway for warm water moving from the Pacific to the Indian Ocean, creating conditions for a major “cetacean migration” highway for 24 different species of whale and dolphin.




Read more:
For Timor-Leste, another election and hopes for an end to crippling deadlock


In 1944, the anthropologist Mendes Correa described the Portuguese colony of Timor as a “Babel … a melting pot”, and a diverse mix of traditions is still strongly felt today.

The island is a bridge between the Malay and Melanesian world and has as much in common with Pacific Island cultures as Indonesia. The diverse indigenous societies cross the spectrum of matriarchal and patriarchal organisation.

Women are accorded a sacred status within Timorese cosmology and the divine female element is prominent in much indigenous belief. Female spirits dominate the sacred world, while men dominate the secular world. So, while women may hold power in a ritual context, they generally do not have a strong public or political voice. But they are fighting to change this and now make up a third of members in the national parliament.

By the early 16th century, Portuguese colonisers arrived in the Spice Islands of which Timor was part. This was the beginning of a colonial relationship now 500 years old.

Revolts by Timorese against Portuguese rule were frequent and bloody. Famous Timorese rebel Dom Boaventura lost an armed uprising against his Portuguese colonisers in 1911, leaving East Timor to be ruled directly from Portugal by the fascist dictatorship of Salazar for most of the 20th century.

The marginal colony remained neglected and closeted from any modern liberalising trends. But in the early 1970s the Timorese independence movement Fretilin, partly inspired by Dom Boaventura, began to oppose Portuguese colonialism, while developing a revolutionary program that included the emancipation of women.

Rosa “Muki” Bonaparte was one of the founders of the nationalist movement and the leader of its women’s organisation. While Bonaparte participated directly in the struggle against colonialism, she also stood against “the violent discrimination that Timorese women had suffered in colonial society”.




Read more:
Australia and Timor Leste settle maritime boundary after 45 years of bickering


After the colonial regime collapsed in 1974, a three-week civil war, secretly manipulated by Indonesian military agents, was the precursor to the larger war and invasion to come.

The victors of the civil war, Fretilin, reconstituted the faction of loyal Timorese soldiers serving in the Portuguese Army as resistance army Falintil. This army, and the civilian resistance, countered the massive and brutal attack of US-and-Australian-backed Indonesian military for 24 years. The horrors were kept as secret as possible, even to the point of covering up the deaths of those trying to report them, such as the “Balibo 5”.

After the Indonesian invasion of December 7 1975, much of the population of East Timor retreated to the mountains, with the resistance living in free zones for the next three years.

However, in November 1978, the Indonesian campaign of annihilation finally encircled the remaining resistance leadership and 140,000 civilians on Mount Matebian, in the east of the island. Most surrendered. They were placed in prisons and “resettlement camps” where many slowly starved to death. The violence of the 24-year Indonesian occupation affected and traumatised the whole of Timorese society.

After the collapse of the Suharto dictatorship in Indonesia in 1998, President B.J. Habibie agreed to let the Timorese decide their future in a ballot. In his honour, they recently named a bridge after him.

Xanana Gusmao was the key negotiator with Indonesia after the independence ballot.
AAP/EPA/John_Feeder

Timor’s pre-eminent leader, Xanana Gusmao, was the key negotiator with UN representatives. He conducted negotiations from his prison house in Jakarta where he’d been since 1992, serving a 20-year sentence for fighting Indonesian forces in his homeland. He persevered with ballot preparations despite growing Indonesian military and militia violence.

In the August 30 1999 referendum, nearly 80% of East Timorese voted for independence by indicating the blue and green National Council of Timorese Resistance (CNRT) flag on the ballot paper.

Extensive military and militia slayings followed the announcement of the vote. An estimated 1500 East Timorese were killed and more than 250,000 forcibly displaced into Indonesia. About 80% of infrastructure was destroyed. Survivors struggled to feed and look after their families while recovering psychologically from the mayhem.

Stories from the resistance period and 1999 are constantly remembered in Timor-Leste and are hugely significant in the new society. A hierarchy based on past service to the resistance has been established. Pensions and payments to male veterans are one of the biggest expenses for the government.

Anthropologists have described an indigenous belief that those who fought and sacrificed “purchased” the nation with their own lives and are owed a living.

Along with celebration there will be much reflection in Timor in the next weeks about the last 20 years of building a nation from “zero” and the 24 years of struggle that came before that. It will consider what they have achieved and what still needs to be done.

Hopefully, Timor-Leste can build a free and fair future for the over 1 million citizens, 60% of them under 18. They include many inspiring, educated young leaders who are ready to take up the responsibility.

As we watch and cheer from the sidelines, we hope for a less eventful and more peaceful future for all Timorese.The Conversation

Sara Niner, Lecturer and Researcher, School of Social Sciences, Monash University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The shaky case for prosecuting Witness K and his lawyer in the Timor-Leste spying scandal


John Braithwaite, Australian National University

Much of the media commentary on the government prosecution of Witness K and his lawyer Bernard Collaery has focused on government duplicity in suppressing the trial until it had its oil and gas treaty signed with Timor-Leste.

But this focus on government hypocrisy has neglected the accountability of the director of public prosecutions, Sarah McNaughton. The prosecution policy of the Commonwealth says:

The decision to prosecute must not be influenced by any political advantage or disadvantage to the government.

McNaughton’s job is to be the key politically independent actor in the process. She must be a check on state political revenge.

This is why the case should of course be in open court, so the public can see how the DPP justifies its independence in the case.




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When whistleblowers are prosecuted, it has a chilling effect on press freedom in Australia


The reason people are worried about the case is that it has the appearance of state revenge against Witness K, who complained through proper channels about the illegality of the bugging he was asked to do, but a decade on served the public interest by blowing the whistle.

Alexander Downer was foreign minister when our international intelligence services were moved away from their counter-terrorism work to focus on commercial espionage on behalf of oil magnates who later offered him a lucrative consultancy. Witness K went public after Downer started working for the consultancy.

So, let the public see in open court whether this is, or is not, a coin-for-the-crown-case that rightly provoked a whistleblower, and not a political revenge case.

Public confidence has been shaken

An even greater concern is that K’s lawyer, Collaery, has been swept up in the government’s prosecution.

From assault to complex commercial crimes, it is common for both sides to make allegations of criminality against the other. We expect the DPP to show independence in assessing who is the greatest victim of crime in complex cases like this. That person will be the least likely to be prosecuted.

The prosecution policy of the Commonwealth also requires the DPP to take into account the views of crime victims in deciding how to manage its deliberations, not only about whether to prosecute. In this case, the public needs to see what kind of victim support services are being provided to Collaery.

For example, the DPP should be asking the government as one of the alleged offenders to make one very public announcement. This is that Australia will continue to abide by the spirit of the International Court of Justice order that the government keep sealed the documents it seized from Collaery’s office in 2013.

The Commonwealth should also assure the public that it will continue to desist from spying on Collaery’s legal work and any bugging or invasion of Collaery’s office.




Read more:
Lawyer and witness face charges under spy laws, raising questions of openness and accountability


Further, the prosecution policy says the government should avoid cases that “undermine the confidence of the community in the criminal justice system”.

That confidence has already been shaken by this case. It will be further shaken if much of it were heard in secret. “Openness” and “accountability” are specified in the policy, binding the DPP to “maintain the confidence of the public it serves”.

Citizen confidence that counter-terrorism laws would not be used against civilians is a public issue. It seems these laws are now hanging over Witness K and Collaery, who most Australians view as patriots rather than terrorists.

Question of resources and timeliness

Lastly, the prosecution policy emphasises that prosecutorial resources are limited. Only those cases most worthy of prosecution should go forward.

Banking and insurance crimes are a real threat to the security of our financial system. These are the kinds of cases where the “public interest” test demands more focused resources, not cases against public-spirited civil servants.

Another element of the prosecution policy is that the passage of time since the alleged offence occurred should also be taken into account.

In this prosecution, the passage of time has been taken into account in the wrong way, delaying prosecution until a political interest of the government has been realised.

The ConversationRarely have the courts in our country faced such a moment of truth for our justice values.

John Braithwaite, Professor, School of Regulation and Global Governance, Australian National University

This article was originally published on The Conversation. Read the original article.

Australia’s deal with Timor-Leste in peril again over oil and gas



File 20180523 51102 1dz1y7g.jpg?ixlib=rb 1.1
The central element of the Timor Sea dispute seems far from resolved.
AAP/Caroline Berdon

Rebecca Strating, La Trobe University and Clive Schofield, University of Wollongong

In April, Australia and Timor-Leste reached agreement on their maritime boundaries in the Timor Sea. This resolved a longstanding source of contention between them.

The potential benefits of this historic breakthrough are now in peril, because the critical issue of how the shared oil and gas of the Timor Sea are to be developed remains in dispute.

Breakthrough on maritime boundaries

Australia and Timor-Leste’s boundary agreement was achieved thanks to a unique dispute resolution process: the United Nations Compulsory Conciliation Commission. The commission was initiated under the United Nations Convention on the Law of the Sea (UNCLOS).

Because both Australia and Timor are parties to UNCLOS, Timor was able to invoke a compulsory conciliation process. It was the first time this has occurred.

Australia was at first reluctant to engage in the UNCC process. It lost its argument that the commission did not have the competence to negotiate the dispute. Australia did then engage with the process in good faith.

Indeed, the success of the UNCC was in large part due to the willingness of both parties to participate in good faith. A series of “confidence building” measures in 2016 helped build trust between the states.

By January 2017, Australia had agreed to terminate the existing Certain Maritime Agreement on the Timor Sea (CMATS). In return, Timor-Leste dropped two international legal cases it had initiated against Australia.

The process set up a neutral commission to run facilitated negotiations over a year, although sessions ultimately ran from July 2016 to February 2018. While participation in the conciliation was compulsory for the parties, it differed from an arbitration process, such as an international court, because the commission’s recommendations could only be non-binding. A crucial aspect of these facilitated negotiations were the discussion papers that allowed both states to think creatively about solving the dispute.

Ultimately, the process succeeded in its primary aim of helping Australia and Timor-Leste to resolve their long-running dispute in the Timor Sea. The breakthrough came in July 2017, when the countries outlined to the commission the points on which they were willing to compromise.

On August 30, an agreement on maritime boundaries, revenue split and an action plan for their engagement in the joint venture was reached. The maritime boundary treaty was signed on April 6 2018.

Deadlock over downstream developments

On May 9 2018, the commission, to little media fanfare, released its report and recommendations on the conciliation.

The report provides valuable insights into the ongoing disputes over development of the Greater Sunrise complex of gas fields located in the Timor Sea – a critical issue for Timor-Leste’s future economic security and development.

Australia and Timor-Leste asked the UNCC to extend its mandate to include the development concept for Greater Sunrise. This extended the sessions beyond the initial one-year period.

Despite its significant success in helping the states agree on maritime boundaries in the Timor Sea, the report indicates little progress was made on the question of how Greater Sunrise gas would be processed.

Crucially, Timor-Leste’s lead negotiator and newly re-installed prime minister, Xanana Gusmao, has consistently advocated a pipeline to the south coast of Timor-Leste to support the development of a Timorese oil and gas processing hub.

The Sunrise Venture Partners (SVP), led by Woodside, have preferred either a floating platform or, more recently, back-filling an existing processing plant in Darwin. Australia, for its part, describes itself as “pipeline neutral”, but supports the decision of the commercial venture partners.

To address this issue, the SVP was invited to participate in the commission process. The report suggests very little progress has been made between the three parties – Australia, Timor-Leste and the SVP – on this dispute.

The commission considered two development concepts, based in Darwin and Timor Leste respectively. According to Gusmao, the pipeline to Timor-Leste is “non-negotiable”. Yet, there is little impartial evidence that this concept would be commercially viable.

In an effort to find a way out of the impasse, the commission employed an independent consultant from a London-based firm, Gaffney, Cline & Associates, to comparatively analyse the two development concepts. The specialist’s assessment, provided in Annexe 27 of the report, said that for a Timorese processing hub to achieve an acceptable return, the Timorese government or another funder would have to subsidise the project to the tune of US$5.6 billion. This is about four times Timor-Leste’s annual GDP, or more than one-third of its Petroleum Wealth Fund.

A letter from Gusmao leaked to the commission in February 2018 – after the last round of UNCC meetings – accused the commission of lacking impartiality, preferring the Darwin concept to the Timor-Leste concept.




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What’s behind Timor-Leste terminating its maritime treaty with Australia


The letter also rejected the comparative analysis provided by the independent expert. It accused the technical expert of not having the “appropriate experience or understanding from working in Timor-Leste” and of having failed to consider the socioeconomic development benefits of the Timorese proposal.

In contrast, the commission’s report noted that Gaffney, Cline & Associates had previously worked for Timor-Leste, but that Australia had not objected to the appointment.

The report suggests that the three parties – Australia, Timor-Leste and the SVP – are no closer to agreement on how to process Greater Sunrise gas.

A looming threat to Timor-Leste’s development

The need to resolve the development issue is increasingly urgent. Timor-Leste is rapidly running out of revenue and development options. Over 90% of its annual budget comes from revenues from oil fields that are expected to be depleted within the next five years. Economically, Timor-Leste does not appear to have a plan B if its strategy for bringing gas to the southern shores of Timor-Leste fails.

Given its precarious situation, one might wonder why Timor-Leste is taking what appears to be a risky approach to this issue, and about what kind of agreements it has sought with other actors or states. In any case, the central element of the Timor Sea dispute seems far from resolved.

The Conversation

Rebecca Strating, Lecturer in Politics, La Trobe University and Clive Schofield, Professor and Challenge Lead, Sustaining Coastal and Marine Zones, University of Wollongong

This article was originally published on The Conversation. Read the original article.

For Timor-Leste, another election and hopes for an end to crippling deadlock


Jerry Courvisanos, Federation University Australia

For the last year, the people of Timor-Leste have expected – and received – little from their government except deadlock.

From a political standpoint, there’s been gridlock for nearly a year after the Fretilin party eked out a victory in parliamentary elections last July, kicking independence hero Xanana Gusmao’s National Congress for Timorese Reconstruction (CNRT) party out of power for the first time in a decade.

However, Fretilin’s minority government found itself blocked at every turn by CNRT and its allies. It finally collapsed in December, forcing the beleaguered president to call for new elections, to be held on Saturday.

At the same time, there’s been economic deadlock, as well. The vast riches of the oil and gas fields in the Timor Sea have been locked away due to Timor-Leste’s seemingly intractable negotiations with the Australian government over a disputed maritime boundary.




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In March, a boundary treaty was finally signed between the countries, which could lead to billions in royalties for Timor-Leste. But disagreements remain on how to develop the untapped Greater Sunrise basin that lies across this boundary.

In the past, Timor-Leste governments have focused on a “big development” economic strategy to exploit the country’s limited fossil fuels, which José Ramos Horta, the Noble Peace Prize laureate and former president and prime minister, has called “an absolute necessity for the future well-being of this country”.

The recent political impasse has put serious discussions about the future of the country on hold. For starters, the tenor in the run-up to the election has been acrimonious and personal, with the leaders of each party trading insults and playing up their contributions to the war of independence against Indonesia instead of debating policy.

Candidates have focused their campaigns on voting for the best “fatherly” figure of the revolution, with little regard for the country’s youth, who suffer from high unemployment rates and have largely been marginalised from the political process.

The economic development of the country, meanwhile, has been left out of the debate. The candidates all stress the need for “big resource development” and the need to build massively expensive gas processing infrastructure on the south coast of the country. But what’s lacking is any indication of whether gas can (or will) be developed in the long term by any multinational gas producer.

Also lacking is any real discussion about the future of the economy and how best to wean the country off its reliance on fossil fuels to drive economic growth. This has long been seen as a risky and unsustainable strategy.

Based on my own research in the country, as well as the work of other academics and development experts, the new Timor-Leste government will need to take a different strategy more in line with the [United Nations’ Sustainable Development Goals], encouraging private investment and developing non-oil exports in agriculture, community forestry and coffee exports. Timor-Leste has committed itself to these SDGs, even if it is struggling to meet them.




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According to tradition, a sacred house in Timor-Leste is formed by four pillars. If two of those pillars are in a sloping position or broken, it will impact the house as a whole. When that happens, the elders will ask the young people to find new pillars to replace the ones that are damaged.

Timor-Leste now finds itself with two broken pillars – the leadership of the country and the dysfunctional parliament. The situation requires the attention of all Timorese to help fix the broken pillars and right the country.

The big question is whether the politicians who are elected on Saturday will listen to the people and bring an end to the deadlock holding the country back.

The ConversationI would like to acknowledge the contribution made to my article by Victor Soares, Lecturer in Public Policy, Universidade Nacional Timor Lorosa’e (UNTL), Dili

Jerry Courvisanos, Associate Professor of Innovation and Entrepreneurship, Federation University Australia

This article was originally published on The Conversation. Read the original article.

Australia and Timor Leste settle maritime boundary after 45 years of bickering



File 20180307 146661 yiatqo.jpg?ixlib=rb 1.1
After nearly two years of a facilitated conciliation process, Australia and Timor Leste have finally reached agreement on a maritime boundary in the Timor Sea.
Shutterstock

Donald R. Rothwell, Australian National University

After nearly two years of a facilitated conciliation process initiated under the 1982 United Nations Convention on the Law of the Sea, Australia and Timor Leste have finally reached agreement on a maritime boundary in the Timor Sea.

The treaty, signed at the UN in New York by Australian Foreign Minister Julie Bishop and Agio Pereira for Timor, will enter into force once all relevant domestic processes have been completed in Canberra and Dili.

This is the latest development in the saga of the Timor Sea, which has been contested for more than 45 years by Australia, Portugal, Indonesia and Timor Leste.

Ownership and control of significant oil and gas reserves, some of which remain undeveloped, are at the centre of the dispute. This partly explains why, despite previous treaties, there has never been a conclusive settlement of the maritime boundary.




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Australia and Timor Leste reach a deal on the Timor Sea – but much remains unknown


The 2018 treaty seeks to permanently settle the Australia/Timor Leste maritime boundary, albeit with the potential for future adjustments subject to negotiations between Timor and Indonesia.

A long time coming

Since the 1970s, Australia has been engaged in negotiations first with Portugal, then Indonesia, and finally Timor Leste over the maritime boundary. Portugal rebuffed Australian approaches in the early 1970s, mindful of developments in maritime law that promised them a better deal.

Indonesia, which occupied Timor from 1975, was more willing to negotiate. A joint development zone was agreed on that broadly shared oil and gas revenue on a 50/50 basis, but set aside a permanent maritime boundary for future settlement.

That arrangement collapsed following Indonesia’s 1999 withdrawal from Timor, and was replaced in 2002 by the Timor Sea Treaty between Australia and the newly independent Timor Leste.

However, the Timor Sea Treaty was again based on a joint development regime –though with a 90/10 revenue split in favour of Timor – and negotiations on a permanent maritime boundary were set aside for up to 40 years.

The treaty also did not satisfactorily deal with the Greater Sunrise oil and gas field in the north east quadrant. While a subsequent 2003 unitisation agreement sought to provide some commercial certainty for the multinationals wanting to develop the field, Dili remained firmly of the view that it was getting a bad deal.

In particular, the generation of Timor’s leaders who led its independence movement placed great importance on the new country having settled land and maritime borders. That the Timor Sea boundary with Australia was not settled remained contentious in Dili. The situation was exacerbated by allegations of Australian spying during treaty negotiations and a Greater Sunrise revenue split that favoured Australia.

Key features

The 2018 treaty contains six prominent features. First, it provides for a southern boundary between Timor Leste and Australia that approximates a mid-way between relevant coastal features. This is consistent with the modern law of the sea.

Second, there is a straight line western lateral boundary that runs from the western terminus of the 1972 Australian Indonesian Seabed Boundary south to the median line.

The new maritime boundary between Australia and Timor Leste.
Department of Foreign Affairs and Trade

Third, the eastern lateral boundary comprises a number of segments that extend much further to the east and north east than the 2002 treaty, ultimately giving Timor Leste much greater entitlements over the Greater Sunrise field.

Fourth, a Greater Sunrise Special Regime is created in which the two countries agree to share the upstream revenue either on a 80/20 basis in favour of Timor, if processing occurs by way of a pipeline to an Australian LNG processing plant, or 70/30 in favour of Timor if a pipeline runs to Timor.

Fifth, Timor gains 100% access to the future upstream revenue of the existing oil and gas fields that were previously part of the 2002 Joint Petroleum Development Area.




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What’s behind Timor-Leste terminating its maritime treaty with Australia


Finally, taking into account these new arrangements will ultimately need to accommodate any maritime boundaries that Timor may negotiate with Indonesia, there is some capacity for adjustment of the eastern and western lateral boundary lines, though only after the commercial depletion of seabed resources in the area.

Unique, but still unresolved

The conciliation process has yielded a unique treaty. It is the first of its type that not only involved the two states, but also the Greater Sunrise Joint Venture partners, including Woodside, Conoco Phillips, Shell, and Osaka Gas.

Timor initiated the conciliation, engaging an independent third party in an effort to break the maritime boundary impasse. It succeeded in getting Australia to abandon its long held opposition to a permanent Timor Sea maritime boundary, and has been able to substantially modify the development regime for Greater Sunrise.

The ConversationNotwithstanding these achievements, some matters remain unresolved, including the location of the LNG processing plant. Whether the plant is located in Australia or Timor is ultimately a commercial decision, but could become the source of ongoing bickering given the significant downstream benefits at stake and implications for Timor’s economic future.

Donald R. Rothwell, Professor, ANU College of Law, Australian National University

This article was originally published on The Conversation. Read the original article.

Australia and Timor Leste reach a deal on the Timor Sea – but much remains unknown



File 20170904 9733 xztzrk
A treaty signing ceremony on the East Timor Sea boundary could take place by the end of the year.
AAP

Donald R. Rothwell, Australian National University

The announcement on the weekend by the Timor Sea Conciliation Commission is the first indication that Australia and Timor Leste are making real progress towards resolving their maritime boundary dispute.

If this process reaches a successful outcome, a permanent maritime boundary will have been drawn in the Timor Sea between Australia and Timor Leste for the first time. However, the conciliation still has some steps to complete. A formal treaty will need to be negotiated, signed and ratified before a new legal framework exists.

The catalyst for the dispute was the 2002 Timor Sea Treaty, negotiated by Australia and the United Nations Transitional Authority in East Timor (UNTAET) in the lead-up to East Timor’s independence. That treaty was based partly on a precedent – the 1989 Timor Gap Treaty between Australia and Indonesia.

The 1989 treaty agreed on a joint development zone for the Timor Sea, providing for a 50/50 sharing of oil and gas revenue. Importantly, existing continental shelf boundaries concluded in 1972, which lay to the east and west in the Timor Sea, were not disturbed. The result was an unusual set of maritime boundary arrangements for the region.

However, this approach was justified because of developments in international law, following the 1982 United Nations Convention on the Law of the Sea, and the contested oil and gas riches of the Timor Sea.

The 2002 Timor Sea Treaty was a variant of this approach, though the joint development area was smaller and the royalty split was 90/10 in favour of Timor.

While the treaty provided some continuity from the previous regime, it left many issues unsettled. There was no permanent maritime boundary and no clear timetable for one to be finalised. There was no clarification of the status of the Greater Sunrise field that straddled the northeastern quadrant, and no clear framework for oil and gas development for the direct benefit of Timor Leste.

These issues formed the basis of Timor’s campaign of the past decade to bring to an end what Dili considered to be an unjust series of associated treaties.

Since October 2016, the Timor Sea Conciliation Commission has met with the parties on six occasions. The most recent meeting concluded on August 30 in Copenhagen. There a breakthrough occurred, which has given confidence that a maritime boundary delimitation in the Timor Sea will be concluded.

Final details remain to be settled, but it seems a package of measures has been agreed. This includes the legal status of the Greater Sunrise gas field, the establishment of a “special regime” for Greater Sunrise, and mechanisms for resource development and revenue sharing.

It is anticipated that the conciliation will conclude by October. By this time the parties may have negotiated a treaty instrument to give effect to these arrangements. If not, treaty negotiations will still be able to take place independently of the conciliation. At this rate of progress, a treaty signing ceremony could take place by the end of the year.

This outcome represents a considerable political victory for Timor Leste. It has been able to force Australian into a third party conciliation, thereby circumventing Australia’s preference for negotiated maritime boundaries. It has also been able to force Australia to abandon its support for joint development in the Timor Sea in favour of a permanent maritime boundary.

While the direction of that boundary remains unknown, international law would support a median line midway between the Australian and Timor coasts, subject to some technical adjustments.

It would appear that Australia has also made concessions on Greater Sunrise. The extent of these remains confidential.

Whether the eastern lateral boundary of the 2002 Timor Sea Treaty has been modified in favour of Timor Leste is unknown. Whatever that outcome, legal mechanisms will be required to resolve the transfer of sovereign rights to Timor from the previous arrangements.

The outcome will be a major achievement for Timor Leste’s goal of settled boundaries, both land and maritime, with its major neighbours Australia and Indonesia. How Indonesia will react to these proposed arrangements remains unknown.

The ConversationAustralia’s most complex maritime boundaries are with Indonesia. These have been carefully negotiated since the early 1970s, but reflect evolving legal rights and entitlements, some of which are out of step with international law in 2017. The challenge that may loom is whether Indonesia will use the precedent of a new Australia-Timor Leste treaty to reopen previously settled maritime boundaries with Australia.

Donald R. Rothwell, Professor, ANU College of Law, Australian National University

This article was originally published on The Conversation. Read the original article.

What’s behind Timor-Leste terminating its maritime treaty with Australia


Rebecca Strating, La Trobe University

The government of Timor-Leste has officially notified Australia of its wish to terminate the 2006 Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS). The treaty sets out the division of revenue from the Greater Sunrise oil and gas fields, an estimated A$40
billion deposit in the Timor Sea.

The maritime border between Timor-Leste and Australia has been a source of contention over recent years. But the decision to terminate the treaty and begin negotiations anew could have serious ramifications for Timor-Leste’s economic development, given its dependence on the Timor Sea resources.

The CMATS treaty

The CMATS treaty was designed to enable the joint exploitation of the Greater Sunrise field. The treaty circumvented the competing border claims by placing a 50-year moratorium on negotiating maritime boundaries betweeen Australia and Timor-Leste.

The Sunrise International Unitisation Agreement, finalised in March 2003, agreed that 20.1% of Greater Sunrise was located in the Joint Petroleum Development Area (JDPA) established under the 2002 Timor Sea Treaty and 79.9% within Australia’s jurisdiction.

If the maritime border was drawn halfway between Australia and Timor-Leste, the oil and gas fields would fall completely within Timor-Leste. Under CMATS, however, Timor-Leste negotiated a 50:50 revenue-sharing arrangement.

Scrapping the CMATS

Timor-Leste has long considered this treaty invalid. In recent years, the governments of Timor-Leste and Australia have been unable to agree on how the Greater Sunrise gas should be processed.

In 2013, Timor-Leste initiated proceedings against Australia at an arbitral court (in the Permanent Court of Arbitration at The Hague) under the Timor Sea Treaty to invalidate CMATS. It did so on the grounds that Australia’s alleged spying on Timor-Leste’s negotiators in 2004 contravened the Treaty of Vienna requirement that treaties be negotiated in “good faith”.

Timor-Leste favours an export pipeline to its south coast to enable its ambitious petroleum industrialisation plans. In contrast, Australia supported the decision of the licensee consortium, headed by Woodside, that the export pipeline was not the best commercial option.

When the CMATS treaty was negotiated, these disagreements were put aside in order to reach an agreement. However, this just delayed the seemingly irreconcilable dispute about developing the field.

Sovereignty

Timor-Leste’s government has developed a narrative that maritime boundaries are necessary for completing its sovereignty. This narrative has linked the independence movement to the sea disputes in order to bolster public support against Australia. Consequently, the moratorium on forming permanent boundaries had increasingly become a problem in relations between Australia and Timor-Leste.

In 2015, Timor-Leste’s government initiated a United Nations Compulsory Conciliation under Annex V of the UN Convention on the Law of the Sea (UNCLOS) in a bid to pressure Australia into changing its policies on Greater Sunrise.

Timor-Leste’s withdrawal from CMATS is not a surprise. In the opening statements of the conciliation process, Timor-Leste’s representatives flagged this as a likely action.

The careful wording of the joint statement makes it clear that the Australian government “recognises” Timor-Leste’s right to initiate the termination of the treaty. This does not suggest that Australia has substantially shifted its long-standing policies on the Timor Sea. However, the joint statement does indicate that the Australian government recognises that maintaining the CMATS treaty had become untenable.

Future negotiations

Terminating CMATS reflects a continuation of Timor-Leste’s high-stakes approach to Timor Sea diplomacy.

Negotiations on establishing a permanent maritime boundary will continue under the UN Compulsory Conciliation. This process is designed to help states resolve bilateral maritime disputes by providing recommendations from a panel of experts.

The Australian government has repeatedly emphasised the non-binding nature of these recommendations. While Australia has an obligation to negotiate in good faith, this does not mean it can be forced into agreeing to a maritime boundary. Negotiated boundaries still appear to be some way off.

Timor-Leste will be pushing for permanent maritime boundaries that will give Timor-Leste most, if not all, of Greater Sunrise in order to support its ambitious oil industrialisation plans.

Terminating the CMATS treaty ultimately means that the governments of Timor-Leste and Australia are back to square one in negotiations over Greater Sunrise.

The consequences

There are a number of potential consequences for Timor-Leste.

First, the revenues that flowed from the Joint Petroleum Development Area under the Timor Sea Treaty have provided approximately 90% of Timor-Leste’s state budget. The Bayu-Undan oil field is expected to be depleted by 2022 or 2023.

Without a source of revenue, Timor-Leste’s economy would be at serious risk of collapse: the A$16 billion petroleum fund could be depleted by 2025. The risk for Timor-Leste is that Australia will prolong boundary negotiations, putting more strain on its finances. Timor-Leste’s vulnerability increases as the window for resolving the dispute before oil revenues run out narrows.

Second, the Exclusive Economic Zone and continental shelf claims of Timor-Leste and Australia overlap with those of Indonesia. While the spectre of Indonesia’s future involvement in the dispute is largely ignored in the media, it would be naïve to believe that Indonesia would not become a third claimant if the opportunity arose.

The Conversation

Rebecca Strating, Lecturer in Politics, La Trobe University

This article was originally published on The Conversation. Read the original article.