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Political turbulence in East Timor could delay Greater Sunrise oil and gas treaty

Sydney Morning Herald - October 16, 2017

Lindsay Murdoch, Bangkok – A landmark agreement to develop billions of dollars' worth of oil and gas reserves in the Timor Sea has been referred to East Timor, where the future of country's new minority government is in doubt.

Opposition parties, which together hold a majority of parliamentary seats, are threatening to vote down as early as Monday the government's program, the first trigger that could lead to the government's fall.

The gas shortfall facing the east coast is three times worse than first thought, the PM has revealed, singling out certain States and Territories for not doing enough to prevent the crisis.

Michael Leach, an expert on East Timor from Swinburne University of Technology, said if the government program is rejected twice it will go into caretaker mode until a new government can be formed, which may also see the holding of fresh elections.

Professor Leach said having a government in caretaker mode would likely delay – but not indefinitely – the signing and ratification of the agreement on a Timor Sea maritime boundary and sharing arrangements for the $50 billion Greater Sunrise oil and gas field that has been negotiated between Australia and East Timor under UN supervision in The Hague.

Under East Timor's constitution, any election could not be held until after January 22.

In a joint statement after series of confidential meetings last week, Australia and East Timor said they had reached agreement on the text of a draft treaty and "the parties will now pursue their domestic approval processes in order to proceed with the signing of the treaty."

Most of East Timor's political parties support a demand by East Timor's former president and prime minister Xanana Gusmao that gas from Greater Sunrise be piped to a yet-to-be developed industrial complex on East Timor's southern coast. Mr Gusmao is tipped to head a new authority to oversee the development.

Officials from Australia and East Timor also met last week with Greater Sunrise joint venture partners to provide what the countries said was "the information necessary to ensure the rapid development" of the Timor Sea reserves.

The venture led by Woodside has rejected bringing the gas across a deep trench to East Timor and said it wanted to build a floating platform to process the gas.

Australia and East Timor struck agreement on "central elements" of a maritime boundary and the establishment of a "special regime" on Greater Sunrise on August 30, ending years of bitter disagreement that strained ties between the neighbours.

But Australia and East Timor said in the statement released in The Hague at the weekend that details of the agreement would remain confidential until "disclosed in a coordinated process following consultations with affected parties." The details were expected to be made public after last week's meetings.

The statement said a further meeting in Singapore in November could set a date for signing the agreement, expected to be by the end of the year or early 2018.

East Timor's two-party minority government led by Prime Minister Mari Alkatiri only took office in September and holds only 30 seats in the 65-seat parliament, five less than the opposition parties.

Politicians from the opposition National Congress for Timorese Reconstruction headed by Mr Gusmao are among opposition MPs who have announced they are ready to form an alternative government that ensures "peace, stability and development."

Mr Gusmao, the hero of East Timor's struggle for independence, has been heading his country's negotiations in The Hague. Although not holding a seat in parliament, he remains East Timor's most powerful politician.

Source: http://www.smh.com.au/world/greater-sunrise-oil-and-gas-project-hinges-on-minority-east-timorese-government-20171015-gz1g6v.html