Lisbon – The Bishop of Dili called Wednesday for the creation of an independent body to oversee the exploitation of Timor Sea oil reserves, the Portuguese news agency Lusa reported.

"The oil is under the Timor Sea, it belongs to everybody and everybody has the right to know what is at stake. That is democracy and transparency," Bishop Ximenes Belo told the agency.

Belo proposed the creation of an independent body, called "Timor Gap Watch", to oversee and control the flow of oil and revenues in and out of the newly independent country.

Belo, who was awarded the 1996 Nobel Peace prize, stressed that such a move would be a positive step towards greater democracy, not a sign of distrust in the government.

East Timor and Australia last May reached agreement on the division of oil and gas revenues from the Timor Sea, which could ultimately enable the nation to end its dependence on foreign aid.

The Timor Sea Treaty awards East Timor 90 percent of profits from oil and gas developments in a designated joint production area, which would guarantee Asia's poorest nation up to five billion dollars in earnings over the next 17 years.

Belo stressed however that East Timor still depended heavily on international aid and that it was unclear how much oil and gas reserves would really spur economic development.

"It remains a mystery. We do not know how much money it will generate. We may not know for certain until 2006 or 2007," he told the Lusa agency.

He further argued that East Timor should not rely too heavily on oil and gas resources, saying: "the source can dry up, and is vulnerable to a crisis or poor management".

Belo last year announced his intention to retire for health reasons, and is currently resting in a retreat belonging to his religious order in Portugal.