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From the La’o Hamutuk Bulletin, May 2002:

Petrotimor: Ancient History?

Many of the experts who have recently raised questions around Timor Sea oil developments were brought here by Petrotimor, a U.S.-based company. Petrotimor was first involved in East Timor oil developments more than thirty years ago – and their involvement now could have far-reaching effects.

Petrotimor is part of Oceanic Exploration, Inc., a small oil company based in Denver, USA. Oceanic Exploration is owned by General Atomics, a large U.S. corporation involved in military contracting, nuclear power, and electronics. Oceanic Exploration has done oil exploration in Greece, Bolivia, Taiwan and other places.

According to Petrotimor, Portugal granted them concessions to explore for oil in the Timor Sea in December 1974, in return for East Timor’s ownership of 20% of Petrotimor. East Timor, then a Portuguese colony, was expected to be independent in a few years. The company was given exclusive exploration and development rights for an area from East Timor’s south coast to the Timor-Australia median line, with lateral  boundaries approximately the same as the 1989 shared area (Areas A and C) now referred to as the Joint Petroleum Development Area. The company began to explore the area in 1975, identifying major features in what are now called Bayu-Undan and Greater Sunrise fields.

When Indonesia invaded later that year, Petrotimor’s agreement became meaningless as Portugal no longer controlled the territory. The company evacuated from Dili, disappearing until June 2001 and playing no part in East Timor’s struggle for independence. But as soon-to-be-independent East Timor was preparing to sign the Timor Sea Arrangement with Australia, Petrotimor reasserted its claim in an unsuccessful effort to spoil the negotiations.

In August 2001, Petrotimor filed a lawsuit against Phillips Petroleum and the Indonesian and Australian governments in Australian court, asking for up to US$1.5 billion in compensation for their expropriated property rights. In the suit, which has yet to be decided, Petrotimor claims that Indonesia’s removal from East Timor restores their concession, and that arrangements made with oil companies by Australia and Indonesia during the occupation are invalid. They say they are not trying to disrupt the current plans and contracts, but simply to be paid for their property.

[In February 2003, an Australian federal court rejected Petrotimor's suit, saying it could not rule on contracts signed under Portuguese law. The company could appeal.]

Petrotimor is also lobbying the East Timorese government to reject the Timor Gap Treaty (JPDA) boundaries and to claim larger boundaries based on Law of the Sea principles. The company is also promoting the idea of a gas pipeline and LNG liquefaction plant in East Timor, instead of to Darwin or on a floating platform, which La’o Hamutuk will examine in a future Bulletin.

Petrotimor could gain a great deal by upsetting the currently proposed arrangements, and they have nothing to lose. They have offered to hire attorneys so that East Timor can bring its boundary claims to court. In return for giving up its 1974 concession, Petrotimor states that they "would expect to participate in the additional government revenues presently attributed to Australia which result from the extension of East Timor’s seabed boundaries." The company would also be 20% owned by East Timor’s government and promises to invest 20% of its profits in East Timorese businesses.

The Petrotimor presentations at the 23 March seminar in Dili skipped key facts such as Petrotimor’s Australian lawsuit. The issues they raise, however, are critically important. And when East Timor’s government decides to pursue the boundary question in court, they should consider Petrotimor – along with others – among the possible sources for legal assistance.

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From the La’o Hamutuk Bulletin, July 2002 (part of a roundup of the oil companies in the Timor Sea):

Petrotimor (Oceanic Exploration)

Where based:

  United States

Year founded: 


Number of employees:



  $3 million


  $3 million

Profits (loss):

 -$2.9 million

Where do they get oil and gas?

 Timor Sea and Kansas, USA

Reserves worldwide nearly:


Claimed Timor reserves:


Timor Sea part of reserves:


Petrotimor claims rights to oil and gas in virtually the entire JPDA based on a 1974 contract with Portugal. Today, its claims are not recognized by any government. (See La’o Hamutuk Bulletin Vol. 3, No. 4).

Petrotimor is part of Oceanic Exploration, a tiny company which owns a few small businesses in different fields. Oceanic is owned by General Atomics, a U.S. nuclear technology company owned by the Blue family. One-fifth of Petrotimor belongs to East Timor. 

In addition to advocating a pipeline to East Timor and providing legal advice for East Timor to claim its full maritime boundaries, Petrotimor is suing Phillips in Australian court for its expropriated property in the JPDA. [The lawsuit was dismissed in February 2003.]

With fewer than 20 employees in several businesses, Oceanic Exploration has no capacity to develop East Timor’s oil resources. Rather, the company is hoping to extract money from companies currently working on Timor Sea oil.

Back to Petrotimor page

The Timor-Leste Institute for Development Monitoring and Analysis (La’o Hamutuk)
Institutu Timor-Leste ba Analiza no Monitor ba Dezenvolvimentu
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