Australia promised East Timor millions of dollars in a secret aid deal that convinced the world's newest nation to give up claims to a huge undersea gas field, a newspaper reported.

Under unpublicized terms of the deal reached last week on sharing billions of dollars in revenues from gas resources under the Timor Sea, Australia agreed to pay East Timor one million US dollars per year for at least five years beginning immediately, The Australian reported.

Australia also agreed to pay its tiny neighbor an additional 10 million US dollars a year once production from the Greater Sunrise gas field begins around the end of the decade, it said.

The aid promise sealed a controversial agreement under which East Timor agreed to Australia's terms for sharing revenues from the Greater Sunrise field, which is believed to hold more than 30 billion dollars worth of gas.

The special payments were contained in a document signed last Thursday after Foreign Minister Alexander Downer was forced to travel to Dili to secure East Timor's signature on the agreement for Greater Sunrise, The Australian reported. East Timor and Australia had been locked in intense negotiations for months over sharing revenues from gas resources in a joint development area in the Timor Sea and from fields that straddled the joint development area and Australian territory.

The two government's agreed last year on a Timor Sea Treaty giving East Timor 90 percent of the revenues from the joint development area, where one field, Bayu Undan, is ready for development.

But Australia held up ratification of the treaty until East Timor agreed to its terms for sharing revenues from the much larger Greater Sunrise field, which mostly lies outside the joint development area.

The dispute came to a head last week due to a March 11 deadline for development of the Bayu Undan field.

With the threat that developers would pull out of Bayu Undan and deprive cash-strapped East Timor of an estimated three billion dollars in revenues, Australia was able obtain its demand for more than an 80 percent share of revenues from Greater Sunrise.

East Timor had demanded a 50-50 share of Greater Sunrise revenues.