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Petroleum in Timor-Leste

Presentation by Santina Soares, La’o Hamutuk
To the International Forum on Petroleum, Human Rights and Environmental Reparation
El Coca, Ecuador

21 October 2006

First of all, I would like to express my gratitude to the Oilwatch international secretariat in Ecuador who organized and invited me to participate in this important event.

Timor-Leste is a small island in Southeast Asia, between two big countries: Indonesia and Australia. Timor-Leste was colonized by Portugal for 450 years and then by Indonesia for 24 years.

During the Portuguese time, we lived under poverty, and most of our population was uneducated. During the Indonesian time, the Indonesian government provided schools and scholarships for many Timorese students, including myself, to study in Indonesia. However, the human rights violations continued, and we did not stop fighting.

For more than two decades, the people of Timor-Leste struggled to liberate ourselves from Indonesian occupation. We gained our independence in 2002, after a two-year, UN-led transition. This history has many complicated factors that I will not describe here.

I will just share with you that Timor-Leste has started to build our new nation. At this time, oil and gas are our main exports and our major revenue sources.

After struggling to gain our independence and liberate our people, we had to struggle to get our sovereignty from Australia. Australia is very interested in our natural resources. We have a long dispute with them about our maritime boundary in the Timor Sea. Australia doesn’t want to define the maritime boundary, but would rather talk about sharing revenue from undersea oil and gas.

In 2002, Australia and Timor-Leste signed the Timor Sea Treaty to exploit oil reserves in the Joint Development Area of the Timor Sea. We share the upstream revenues -- 90% for Timor-Leste and 10% for Australia. But in reality Australia gets more than that.

Since 2002 we have not kept quiet, and continue to struggle with Australia in the negotiating room and on the streets, organizing many demonstrations to demand the establishment of a fair maritime boundary. However, it has been difficult to get Australia to follow international law. Just two months before Timor-Leste became independent, Australia withdrew from maritime boundary dispute resolution processes of UNCLOS and the International Court of Justice, showing the legal weakness of their position. At the same time, Australia continues to pressure our government to negotiate about sharing revenues.

In January 2006, both governments signed the CMATS treaty, which divides upstream revenue from the largest undeveloped field 50% for Australia and 50% for Timor-Leste. Other contested areas are given to Australia. Is this fair? Of course not! These fields are in our territory, and this is our poverty!

We still ask Timor-Leste’s government and parliament not to ratify this treaty, but to send it back for renegotiation.

For the last seven months, we have very difficult conflicts in our country, all involving militarization. More than half of the residents of our capital city are living in refugee camps.

Women and children are the main victims of these conflicts. This reflects political, economical, judicial and security instability, and that most people live in poverty.

Women suffer by losing their homes, some lose their husbands, have miscarriages, or die because they cannot get to the hospital. Rape and sexual harassment are widespread.

Children lose their freedom, they cannot go to school, malnutrition is common. Life in the camps is very difficult.

As a civil society organization, we also press our government to manage oil and gas revenues properly, for the benefit of all our citizens, and to avoid the “Resource Curse.” There are mechanisms for Civil Society to play our role, but it is not easy to make them effective, so we have to build strong national and global networks.

So, as witnesses in this difficult situation we will not stay silent. We have to stand up and fight against international pressure, political instability and poverty.

The Timor-Leste Institute for Development Monitoring and Analysis (La’o Hamutuk)
Institutu Timor-Leste ba Analiza no Monitor ba Dezenvolvimentu
Rua D. Alberto Ricardo, Bebora, Dili, Timor-Leste
P.O. Box 340, Dili, Timor-Leste
Tel: +670-3321040 or +670-77234330
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