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Australian Journal of Asian Law

Abstract from Volume 4 No 2 (2002)

The New Timor Sea Treaty between East Timor and Australia

Professor Gillian Triggs is Co-Director, Institute for Comparative and International Law, Faculty of Law, University of Melbourne.

On independence day 20 May 2002, East Timor agreed with Australia on the terms of the new Timor Sea Treaty for the joint development of the petroleum resources of the 'Timor Gap'. A separate Exchange of Notes maintains the terms of the original 1989 Timor Gap Treaty, providing a bridge during the interim period before each state ratifies the Timor Sea Treaty. This article describes and considers the principal features of the new agreement. The most notable legal issue raised by the Timor Sea Treaty is the decision to share the production from the proposed Joint Petroleum Development Area (JPDA) on the basis that East Timor receives 90 per cent and Australia only 10 per cent. The Timor Gap Treaty was scrupulous in preserving the respective juridical positions of Australia and Indonesia so that the treaty remained sovereign-neutral in its effect. By contrast, the new Timor Sea Treaty creates a structure that in certain respects distinctly favours control by East Timor through the proposed Joint Commission. While a 'without prejudice' clause technically protects the views of Australia and East Timor on seabed delimitation, future activities under the new agreement may render it increasingly difficult for Australia to insist upon its claim to sovereignty over the continental shelf up to the Timor Trough. In other respects, the Timor Sea Treaty, unlike the Timor Gap Treaty, does not include a mining code or model production-sharing contract. Nor does it resolve fiscal uncertainties. A further impediment to ratification may be East Timor's claim to sovereignty over the Greater Sunrise fields that straddle the eastern lateral of the JPDA. Current discussions on unitisation of this deposit may determine whether the new Timor Sea Treaty comes into effect.

(2002) 4(2) Asian Law 188

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