Tim Dodd, Bandar Seri Begawan – East Timor has asked Australia to take over part of its maritime security in a new treaty that would substantially increase the ocean area in which the two countries share billions of dollars in oil and gas revenue.

If the plan goes ahead, it would end uncertainty for Australia over the national ownership of the lucrative Greater Sunrise gas field, which has been the cause of increasing tensions between the neighbours over revenue sharing.

But East Timor appears to have softened its hardline stance on expanding its own maritime boundary. It will instead move to widen the joint-development area to win the sensitive security guarantee from Australia.

East Timorese Foreign Minister Jose Ramos Horta said yesterday that he put the concept to Foreign Affairs Minister Alexander Downer in Canberra last month and was waiting for Australia to respond with a draft proposal.

The deal would draw Australia into a permanent, formal arrangement under which it would take responsibility for part of East Timor's southern border security. This would give the vulnerable new nation an added guarantee of Australian protection after the tumultuous separation from Indonesia.

Mr Ramos Horta was speaking in Brunei, where he is attending the annual meeting of the Association of South-East Asian Nations as a guest.

While the Timor oil proposal is a purely bilateral treaty between Australia and Timor, it dovetails with the emphasis at the ASEAN meeting on greater security co-operation between the member countries, particularly on terrorism.

The ASEAN ministers are to sign a landmark anti-terror agreement with US Secretary of State Colin Powell at a forum today that will be attended by all key regional countries including Australia.

It could also be the venue for reopening dialogue between the US and North Korea, branded by President George Bush as part of an axis of evil, because North Korea's Foreign Minister, Paek Nam-sun, is also attending. Mr Powell said yesterday he would wait until arriving in Brunei before deciding whether to meet Mr Paek.

If the deal – which Mr Ramos-Horta wants to be a formal treaty between the two nations – goes ahead, it would end uncertainty for Australia over the national ownership of Greater Sunrise, which Woodside Petroleum, Phillips Petroleum and Shell plan to develop at a cost of about $4 billion.

Yesterday, Mr Ramos-Horta said he was proposing an "overall, comprehensive strategic agreement for the development of the entire Timor Sea area" that would offer a way out of the deadlock over boundaries and revenue sharing.

"Realistically, who is going to protect East Timor's southern coast. Either we trust Australia, enter into a strategic arrangement with Australia, or leave our seas open to pirates and drug traffickers," he said.

If it goes ahead, Mr Ramos-Horta's treaty proposal will head off a bitter dispute over the Greater Sunrise field, which straddles an area claimed by Australia and the "joint petroleum development area" in which East Timor is entitled to 90 per cent of royalties and Australia 10 per cent.

Mr Downer could not be contacted yesterday and a spokesman for the Minister for Industry, Tourism and Resources, Ian Macfarlane, said he would not comment until he had received a full report.

The two countries signed an agreement in May to split Greater Sunrise revenue, allocating 20 per cent to the joint area and 80 per cent to Australia. Taking into account the joint-area revenue split, this means that Australia will take a lion's share 82 per cent of Greater Sunrise revenue, which East Timor still believes it should own entirely.

The agreement does not decide maritime boundaries and East Timor's Prime Minister, Mari Alkatiri, made it clear in a visit to Australia last month that he will push for permanent boundaries that would give Greater Sunrise - as well as the Laminaria field controlled by Woodside Petroleum, BHP Billiton and Shell – to East Timor.

But Mr Ramos-Horta said yesterday that the Greater Sunrise issue should be separated from the maritime boundary talks.

"It means that even if, on paper, our boundary would include all of Greater Sunrise, we would be able to reach a separate agreement of revenue sharing on Greater Sunrise which would be satisfactory to Australia," he said.

Mr Ramos-Horta said he had not yet looked at the specific revenue split under any treaty over Greater Sunrise. He also said he had only had limited discussions about the plan with Mr Alkatiri, and it had not yet been put to East Timor's Cabinet.

But he said he was confident it would be accepted by Dili. "On our side, we have to be very pragmatic [and realise] that Australia will not concede such a hugely rich energy reserve. We should look at the entire Timor Sea area as a zone of friendship rather than fighting over details of who owns what," he said.

"Even if Australia was a reincarnation of Mother Teresa, she would be very hesitant to concede that much to East Timor. I don't think any government would give away so much, even if he or she knew she was not the legitimate owner."

Australia removed East Timor's legal avenue for pursuing the claim in March when it withdrew its recognition of the jurisdiction of the International Court of Justice and the International Tribunal for the Law of the Sea over maritime boundary disputes.

Mr Ramos-Horta said that, under his plan, Australia would take responsibility for patrolling East Timor's southern maritime zone and guard against illegal fishing, illegal migration, drug trafficking and smuggling, which East Timor had limited capacity to do itself. He said he also saw it including Australian training of East Timorese personnel and the transfer of technology for maritime surveillance. Possibly it would involve Australian use of East Timorese facilities, he said.

Mr Ramos-Horta said the plan would help create a "zone of peace and prosperity" in the Timor Sea and would link to an existing initiative to build commercial ties between East Timor, Australia and eastern Indonesia.

He said he also wanted to extend this "triangular relationship", which currently involves just the Northern Territory, to Western Australia and Queensland. He said he would push for a meeting soon between governments to look at economic development and trade promotion in this region.