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Unravelling Timor-Leste’s Greater Sunrise strategy

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In Brief

Disputes over the resource-rich Timor Sea have consumed bilateral relations between Timor-Leste and Australia. In 2006, Timor-Leste’s then foreign minister José Ramos-Horta and his Australian counterpart, Alexander Downer, signed the Treaty of Certain Maritime Arrangements in the Timor Sea (CMATS). The treaty aimed to distribute revenues derived from the lucrative but disputed Greater Sunrise oil and gas field.


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In brokering this so-called ‘creative’ solution, Australia and Timor-Leste set aside intractable disagreements over establishing permanent maritime boundaries and developing a petroleum export pipeline. These crucial issues remain unresolved and many Timor-Leste representatives and activists are displeased with current treaty arrangements. Allegations of Australia spying during negotiations in 2013 and stealing documents from Timor-Leste’s Australian lawyer have compounded this dissatisfaction.

Timor-Leste’s government now pursues a ‘fair’ settlement of permanent boundaries, which, in its view, would entail Timor-Leste controlling all of Greater Sunrise. But Australia currently refuses to negotiate permanent boundaries.

Timor-Leste’s oil dependence makes the maritime boundary dispute a significant domestic issue. Oil and gas exports account for around 90 per cent of Timor-Leste’s GDP. Estimates suggest that revenues from the joint development area could run out in the early 2020s.

The core national interests of Timor-Leste have been presented in the public discourse as symbolic rather than material. Various Timorese leaders have suggested that Timor-Leste’s interests are primarily in completing its sovereignty. Prime Minister Rui Maria de Araújo recently argued that ‘establishing permanent boundaries is a matter of national priority for Timor-Leste as the final step in realising our sovereignty as an independent state’. Timorese representatives link the Timor Sea dispute with its struggle for independence against Indonesian occupation, propagating the questionable notion that without permanent maritime boundaries Timor-Leste’s sovereignty remains incomplete.

Symbolic narratives around sovereignty are useful in provoking domestic and international support. They mirror the anti-colonial nationalism that characterised Timor-Leste’s 24-year resistance movement, the legacies of which continue to shape Timorese domestic politics. Recent rallies in Dili also demonstrate how the Timor Sea dispute feeds into a broader anti-Australian public sentiment. The narratives position Australia as an illegal ‘occupier’, encouraging a form of national unity that emerges vis-à-vis a common enemy.

The sovereignty narrative bolsters the political legitimacy of leaders. The intensification of the dispute has the hallmarks of a political sleight-of-hand as it distracts citizens from pressing socioeconomic and governance problems. The claim that Timor-Leste’s interests in delineating maritime boundaries are primarily about sovereignty is not entirely convincing. If permanent maritime boundaries, not material resources, were paramount to securing Timor-Leste’s sovereignty, one might assume that Timor-Leste would agree to a boundary that does not place Greater Sunrise in its possession.

Since 2006, Timor-Leste’s representatives have sought to win the right to develop a pipeline from Greater Sunrise to the South Coast of Timor-Leste. Australia, and  corporations such as Woodside, refused and negotiations stalled. Winning sovereign control of Greater Sunrise through the settlement of permanent maritime boundaries would allow Timor-Leste to build its pipeline.

The pipeline is at the centre of the ambitious development agenda of successive Timorese governments, headed first by Xanana Gusmão and then Rui Araújo, which have invested heavily in national infrastructure projects.

Timor-Leste’s 2011 Strategic Development Plan committed to developing three key sectors: agriculture, tourism and petroleum. It supported the view that the pathway to development was through developing oil refinery industries. The plan argues that through its training and employment opportunities, the petroleum sector generates broader socioeconomic gains than ‘the simple selling of oil and gas’.

Oil and gas form the centrepiece of the petroleum industries being established on the coast of Tasi Mane in the island’s south. This is currently one of Timor-Leste’s high-priority infrastructure developments. Spending on the Tasi Mane Project — a coastal corridor of petroleum infrastructure — is projected to exceed US$1.4 billion from 2016 through 2020. By way of comparison, the proposed 2016 budget is just over US$1.5 billion.

According to academic James Scambary, the ambition of the Tasi Mane Project — comprising three industrial clusters, an airport and a 155 kilometre highway — ‘suggests a political rather than economic motivation’. Others have criticised Tasi Mane as a ‘fantasy’ project and a wasteful ‘white elephant’.

Still it has been prioritised ahead of agriculture and tourism. And the increased infrastructure spending has come at the expense of social welfare programs. Problematically, the viability of Tasi Mane rests upon the Greater Sunrise pipeline. It is hard to see Timor-Leste’s petrochemical industries becoming internationally competitive against well-established industries in Southeast Asia.

The pipeline remains crucial for understanding Timor-Leste’s foreign policy approach. The government has abandoned unproductive pipeline negotiations with Australia in pursuit of a greater prize: permanent maritime boundaries that give Timor-Leste control over Greater Sunrise. Success would enable the Timorese government to establish the pipeline, justify its Tasi Mane investment and advance its development ambitions.

It is a high-reward, but high-risk strategy. Ultimately, its success will rely on Australia changing its perceived interests in the Timor Sea — an unlikely scenario.

Bec Strating is Lecturer at the Department of Politics and Philosophy at La Trobe University, Melbourne.

One response to “Unravelling Timor-Leste’s Greater Sunrise strategy”

  1. In order to sum up the Greater Sunrise fields dispute between Australia and Timor Leste the following points must be acknowledged:

    • According to the 1982 United Nations Convention on the Law of the Sea every coastal state has a right to 200 nautical mile Exclusive Economic Zone (EEZ) in which they have full sovereignty from the water surface to under the seabed. Australia signed this Convention in 1994;

    • Where EEZs overlap, or are adjacent, international courts and tribunals have developed a process that uses the equidistant (or median) line as the starting point, and then adjusts the line to take into account ‘relevant circumstances’ which modify the line such as the location of minor islands or the concavity of coastlines;

    • The Greater Sunrise fields are located 150 kilometres south-east of Timor-Leste and 450 kilometres north-west of Darwin. Therefore, according to international law the Greater Sunrise fields would lie entirely within Timor-Leste’s territory;

    • Timor-Leste’s position was that the border should be the median line and that taking into account ‘relevant circumstances’ the laterals should be pushed further east and west;

    • Australia wanted to continue the temporary resource sharing arrangements negotiated in 1989 when Indonesia was still illegally occupying Timor-Leste;

    • Timor-Leste was unable to have an independent umpire decide a maritime border with Australia because of a ‘decision in March 2002 by Australian’s then Foreign Minister Alexander Downer’ to pull Australia out of the compulsory jurisdiction of international courts and tribunals in relation to maritime boundary matters; and

    • Mr. Downer’s decision was made just two months before Timor-Leste finally achieved its independence.
    On July 2004 Australia and New Zealand signed a maritime boundary treaty negotiated according to the principles set out in the UN Convention on the Law of the Sea. At the same time, in bi-lateral talks in Dili, Australia was refusing to negotiate a maritime boundary with Timor-Leste according to the principles set out in the UN Convention on the Law of the Sea. During these negotiations Foreign Minister Alexander Downer allegedly authorised Australian spies to secretly record the Timor-Leste negotiating team. Australia’s alleged spying during the negotiations of the CMATS treaty clearly gave Australia an unfair advantage and is evidence that Australia did not sign the treaty in good faith.
    On 9/01/2017, Timor Leste terminated its 2006 treaty with Australia, which split revenue from the Greater Sunrise field 50/50 and delayed negotiations over a permanent maritime boundary for 50 years. East Timor initiated the compulsory conciliation process last year in a bid to force Australia to negotiate a permanent maritime boundary. The country claimed the treaty was invalid because of allegations that Australia spied on cabinet ministers during negotiations to divide the oil and gas fields.
    The announcement on September 2017 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.
    While the details remain confidential, the court said the agreement ‘addresses the legal status of the Greater Sunrise gas field … and the sharing of the resulting revenue’.
    It must be noted 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.
    It was anticipated that the conciliation would conclude by October 2017 and that the parties had negotiated a treaty instrument to give effect to these arrangements. This has not occurred and treaty negotiations remain on foot and are independent of the conciliation.
    At the current rate of progress, and given Australia’s track record a treaty signing ceremony is unlikely to occur this year.
    If this dispute is settled it will be a major achievement towards Timor Leste’s goal for settled boundaries, both land and maritime, with its major neighbours Australia and Indonesia.
    Notwithstanding the above, there is speculation that if the dispute is not signed before a new government is elected or appointed by President Guterres, the extent of the agreement on the Timor Sea that has been reached could be back on the table for renegotiation.
    Further, how Indonesia will react to these proposed arrangements remains unknown. Australia’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.

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