Wednesday, May 25, 2005. 0:44am (AEST)
ABC News online.

Gas deal with Australia close, says E Timor

East Timor and Australia are "very close" to reaching a deal on billions of dollars of oil and gas reserves under their shared Timor Sea, East Timor Prime Minister Mari Alkatiri said in Norway.

"I do believe that we are close to a deal, very very close to get a deal, but still we need to work on some details of the agreement," Mr Alkatiri told reporters.

It had previously been reported that an agreement has been concluded, but on Saturday East Timorese officials again denied that a compromise accord had been signed.

"We are not rushing. We're looking for a good agreement between two neighbour states," Mr Alkatiri said after a meeting in Oslo with his Norwegian counterpart Kjell Magne Bondevik.

"We've been discussing for almost three years. It's still a very short time. Everywhere around the world, (countries) have been discussing for hundreds of years and they're still waiting to resolve" their problems, he said.

A 1972 sea boundary agreed between Australia and Indonesia gave Canberra two-thirds of the sea area between the two nations and most of its energy resources, estimated to be worth around $42 billion.

East Timor, which won independence from Indonesia three years ago, wants the boundary set at the mid-point between East Timor and Australia, giving it most of the resources.

Mr Alkatiri refused on Tuesday to disclose the details of the compromise discussed with Australia.

One of the poorest countries in Asia, East Timor hopes to follow in oil-rich Norway's footsteps in managing its revenues of black gold, and like the Scandinavian country is in the process of setting up an oil fund where the revenues can be put aside for future generations.

Mr Alkatiri said he also hoped to set up a state-controlled oil company like Norway's Statoil, which is 70.9 per cent-owned by the state.

"The example of Statoil is a very good example. We believe we need a national company as a way to really control our resources," he said, adding that such a project could become a reality before the end of the year.

-AFP

<< BACK