AUTHOR SAYS AUST EXTORTED EAST TIMOR OIL, GAS

Author says Aust extorted East Timor over oil, gas

PM - Friday, 1 June , 2007 18:46:00

Reporter: Mark Colvin

MARK COLVIN: "Shakedown" is a slang term for an act of extortion, and a shakedown is what the writer Paul Cleary calls the way Australia acted towards East Timor over the oil and gas in the sea between our two countries.

Mr Cleary is a former journalist who was appointed by the World Bank as an adviser to East Timor's Prime Minister in the oil and gas negotiations.

His new book on the story is called Shakedown, and I asked him first, if East Timor's case for the resources was so cut and dried, why had the Indonesians, who were in charge before Timorese independence, agreed so easily to Australia's demands.

PAUL CLEARY: Indonesia signed that agreement when international law in this area was in its infancy and subsequent to that the Foreign Minister said Australia had taken Indonesia to the cleaners.

MARK COLVIN: So you're saying that Australia kind of behaved as some kind of regional bully?

PAUL CLEARY: I think there was a lot of bully that went on. Mr Downer pounding the table saying "we're a rich country, we can sit this out for 30, 40, 50 years". And also really threatening East Timor to sever its economic lifeline to stop development in the Timor Sea unless East Timor signed over its rights to 80 per cent of the biggest field in the area.

Meanwhile Australia was already exploiting the resources, which was actually contrary to international law. I think people in East Timor would've wanted it to take longer but however I think the Government particularly in the interim period from 2000 when the UN was in control in the transitional government, there was a need to get the revenue, so that's why the Timor Sea Treaty was negotiated in 2000 and signed in 2002.

MARK COLVIN: And then we got to this point in 2004 when the East Timorese patience just ran out and one of the signals was actually on this program when Jose Ramos-Horta came on spoke to me about what the DFAT (Department of Foreign Affairs and Trade) negotiator Doug Chester had just done.

(excerpt from PM interview)

JOSE RAMOS HORTA: The Australian side basically imposed on us an ultimatum. Mr Doug Chester, the Senior Official from Foreign Affairs, DFAT, that led the Australian delegation simply said "take it or leave it".

MARK COLVIN: So what did you say to this "take it or leave it"? offer?

JOSE RAMOS HORTA: Of course we can't accept ultimatums, we cannot accept blackmail, we are poor but we have a sense of honour, a sense of dignity of our rights.

MARK COLVIN: Jose Ramos Horta is a man, usually very moderate words. What was the significance of what he said?

PAUL CLEARY: He is, I mean, in this book I call Mr Ramos Horta the consummate diplomat, he always is very measured and this is a rare example of him really loosing his cool, loosing his patience. Because this is a classic example of the bullying tactics that were being used, Mr Doug Chester telling the Timorese, "You hand over your rights to this field by 5 pm on October 28th and we'll give you $3-billion and that's it," and Timor by digging in standing up for its rights, managed to get 3 times that amount of current oil prices.

MARK COLVIN: So it was worth hanging on?

PAUL CLEARY: Oh definitely. I think the Timorese are, realized once they got the revenue under the Timor Sea Treaty, and once Australia ratified that treaty the revenue began to flow. They had a bit more comfort they could afford to stand their ground and to really get the deal they thought was fair.

And in the end I think what the Timorese got was probably the 50 per cent share of Greater Sunrise, probably the minimum acceptable to the Timorese and the maximum that Australia was willing to give up.

MARK COLVIN: So it ended without irreparable damage to the relationship between the two sides. What about the situation in East Timor, the spending of the money?

PAUL CLEARY: Timor does have a very good system to save the money. This was modeled on Norway, which really does have a very excellent system, very transparent, very robust, really cannot be tampered with.

MARK COLVIN: They used their oil to really create a massive future fund…

PAUL CLEARY: Exactly, it was a massive future fund. Something that Australia could actually think about well with all the revenue we're getting from the commodity boom.

Essentially Timor is only spending about half the money and the idea is at the end of it, when the oil runs out, they'll have this massive fund and they can live of the interest forever.

MARK COLVIN: This is to overcome what some people call the curse of oil?

PAUL CLEARY: The resource curse, that's right, or the paradox of plenty. All these problems that these coun tries get a huge influx of revenue, it inflates their exchange rate, political leaders go and spend money on weapons and big grandiose palaces and things. So the idea is to have the fiscal discipline.

The problem with Timor had been though is that they haven't done a very good job spending the money. And this has been the real weakness in the current government.

MARK COLVIN: Because what we see, what we tend to see on our television screens from Timor recently has been riots and poverty.

PAUL CLEARY: Well exactly, you got massive youth unemployment. I mean the East Timor economy went backwards for four years straight in per capita terms.

I mean no developing country coming out of a post conflict situation can really stay together under that situation. And that was really I think the background to this crisis that a lot of people will have overlooked.

That it was the Government's failure with the UN withdrawing rapidly and I think that was a problem Australia urged that of the United Nations to pull out the peacekeepers.

The economy imploded, and the Government was very fiscally conservative, I think they had some quite patronising ideas about the Timorese, that you can't trust them with money, and they'll have this dependency mentality but there just wasn't enough money circulating around the economy.

MARK COLVIN: Paul Cleary whose book Shakedown was released today.

Appendix C: Agreed Minutes of Meeting Between Officials of Australia and Indonesia on Fisheries (29 April 1989)

1. In accordance with the agreement reached by Mr. Ali Alatas, the Foreign Minister of Indonesia and Senator Gareth Evans, the Foreign Minister of Australia in Canberra on 2 March, 1989, Officials from Indonesia and Australia met in Jakarta on 28 and 29 April 1989 to discuss activities of Indonesian fishing vessels under the Memorandum of Understanding between the Government of the Republic of Indonesia and the Government of Australia regarding the operation of Indonesian traditional fishermen in an Area of the Australian Fishing Zone and Continental Shelf, concluded in Jakarta on 7 November 1974. They also discussed activities of Indonesian fishing vessels in the Australian Fishing Zone off the coast of North West Australia and in the Arafura Sea, and fishing in the waters between Christmas Island and Java.

Memorandum of Understanding of 1974

2. Officials reviewed the operation of the MOU. Both sides stressed their desire to address the issues in a spirit of cooperation and good neighbourliness. They noted that there had been a number of developments since 1974 which had affected the MOU. In 1974 Australia and Indonesia exercised jurisdiction over fisheries on 12 nautical miles from their respective territorial sea baselines. In 1979 and 1980, Australia and Indonesia respectively extended their fisheries jurisdiction to 200 nautical miles from their respective territorial sea baselines, and in 1981 a provisional fishing line was agreed. Since the areas referred to in the MOU are south of this line, new arrangements are necessary for the access by Indonesian traditional fishermen to these areas under the MOU.

3. The Australian side informed the Indonesian side that there were also changes in the status of Ashmore Reef and Cartier Islet as a separate territory of the Commonwealth of Australia and the establishment of the Ashmore Reef (Pulau Pasir)  National Nature Reserve. The Australian side further informed that there had been a considerable increase in the number of Indonesian fishermen visiting the Australian Fishing Zone and a depletion of fishery stocks around the Ashmore Reef (Pulau Pasir) , that wells on Middle Islet and East Islet where Indonesian traditional fishermen were permitted under the MOU to land for taking fresh water had been contaminated; that Australia had also incurred international obligations to protect wildlife, including that in the territory of Ashmore (Pulau Pasir) and Cartier Islands. The Indonesian side took note of this information.

4. Since the conclusion of the MOU, both Indonesia and Australia had become parties to the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

5. The Indonesian and Australian Officials discussed the implications of the developments mentioned in the preceding paragraphs. They affirmed the continued operation of the MOU for Indonesian traditional fishermen operating by traditional methods and using traditional fishing vessels. An Australian proposal that Indonesian traditional fishermen could conduct fishing not only in the areas adjacent to Ashmore Reef (Pulau Pasir) , Cartier Islet, Scott Reef, Seringapatam Reef and Browse Islet as designated in the MOU, but in a wider ‘box’ area in the Australian Fishing Zone and Continental Shelf was welcomed by the Indonesian side. A sketch map and coordinates of this ‘box’ area appears in Annex 1 of this Agreed Minutes.

6. In view of the developments that had occurred since 1974 as highlighted above, Officials considered that to improve the implementation of the MOU, practical guidelines for implementing the MOU as appears in the Annex of these Agreed Minutes were considered necessary.

7. The Indonesian side informed the Australian side on measures that had been and were being taken by the Indonesian authorities to prevent breaches of the MOU. The Indonesian side indicated its willingness to assist in preventing breaches of the MOU and to take necessary steps to inform Indonesian fishermen of the practical guidelines annexed to this Agreed Minutes.

8. The Indonesian and Australian Officials agreed to make arrangements for cooperation in developing alternative income projects in Eastern Indonesia for traditional fishermen traditionally engaged in fishing under the MOU. The Indonesian side indicated they might include mariculture and nucleus fishing enterprise scheme (Perikanan Inti Rakyat or PIR). Both sides mutually decided to discuss the possibility of channelling Australian aid funds to such projects with appropriate authorities in their respective countries.

North West Coast of Australia

9. The Indonesian and Australian Officials discussed matters related to the activities of Indonesian fishing vessels in the Australian Fishing Zone off the coast of North West Australia. They noted that those activities

were outside the scope of the MOU and that Australia would take appropriate enforcement action. The Australian side indicated the legal and economic implications of such activities.

10. The Indonesian and Australian Officials felt the need for a long-term solution to the problem. To this end, they agreed to make arrangements for cooperation in projects to provide income alternatives in Eastern Indonesia for Indonesian fishermen engaged in fishing off the coast of North West Australia. The Indonesian side indicated that they might include mariculture and nucleus fishing enterprise scheme (Perikanan Inti Rakyat or PIR). Both sides decided mutually to  discuss the possibility of channelling Australian aid funds to such projects with appropriate authorities in their respective countries.

Arafura Sea

11. Indonesian and Australian Officials discussed the activities of Indonesian non-traditional fishing vessels in the Arafura Sea on the Australian side of the provisional fishing line of 1981. Officials agreed that both Governments should take effective measures, including enforcement measures, to prevent Indonesian non-traditional fishing vessels from fishing on the Australian side of the provisional fishing line without the authorisation of the Australian authorities.

12. Officials agreed to make arrangements for cooperation in exchange of information on shared stocks in the Arafura Sea for the purpose of effective management and conservation of the stocks.

Fishing in waters between Christmas Island and Java and other waters

Catatan Penulis : Perbedaan Spesifik 2 (dua) buah Peta disini adalah pada Garis Pembatas Perairan Indosenia - Australia

1). Peta Rekayasa Australia secara sepihak  ini dibuat setelah MOU 1974 antara Indonesia – Australia, dimana membuat batas baru yang berkelok-kelok SETENGAH LINGKARAN dan TIDAK LURUS supaya memasukkan Pulau Pasir (Ashmoro Reef)  menjadi milik Australia adalah TIDAK SYAH.

2. Garis Batas RI dan Australia yang sebenarnya adalah seperti  terlihat pada Peta  Kabupaten Kupang dan Kabupaten Rote Ndao di bawah ini, dimana, letak Gugusan Pulau Pasir (Ashmoro Reef) berada di perairan Indonesia yang dibatasi oleh Garis Batas Merah RI – Australia. Peta ini buatan Hindia Belanda sebelum Indonesia Merdeka 17 Agustus 1945.

Peta ini harus dipakai guna pembicaraan kembali status Pulau Pasir (Ashmoro Reef) antara Indonesia dan Australia. (Ini adalah Peta lama Belanda, merupakan data autentik  yang tidak dapat disangkal lagi oleh pihak Australia. Dengan demikian Peta 1 buatan Rekayasa Australia setelah tahun 1974 dinyatakan Tidak Berlaku karena peta tersebut dibuat secara sepihak saja. Dengan demikian semua pembuatan MOU tentang Batas Perairan  Indonesia – Australia dinyatakan BATAL dengan sendirinya.

Ternyata saat Menlu RI, Ali Alatas membuat MOU  1974 dan tahun-tahun

sesudahnya tentang Perbatasan Indonesia – Australia hanya dibuat dari belakang meja saja tanpa berkonsultasi dengan Pemerintah Daerah Propinsi Nusa Tenggara Timur, mapun dengan Masyarakat Adat Suku Rote (Kabupaten Rote Ndao, NTT) tentang pulau karang wilayah Indonesia paling Selatan Indonesia, yang berbatasan dengan Australia  dimana sejak dulu Masyarakat Adat Suku Rote telah menguasai Pulau Pasir (Ashmoro Reef)  secara turun temun. Kemungkinan Besar Pihak  Departemen Luar Negeri RI tidak memiliki Peta Hindia Belanda ini, sehingga  telah keliru  dalam pembuatan MOU tersebut. (Penulis)

13. The Officials of Indonesia and Australia noted that fisheries delimitation in waters between Christmas Island and Java and in the west of the provisional fishing line remained to be negotiated and agreed. Pending such an agreement, the Officials noted that both Governments would endeavour to avoid incidents in the area of overlapping jurisdictional claims.

Wildlife Cooperation

14. The Indonesian and Australian Officials considered the mutual advantages of the exchange of information on wildlife species populations believed to be common to both countries. It was agreed that each country’s nature conservation authorities would exchange information on such wildlife populations and management programs and cooperation in the management of wildlife protected areas. In the first instance Indonesian authorities would be consulted on the management plan for the Ashmore Reef National Nature Reserve.

Consultations

15. The Indonesian and Australian Officials agreed to hold consultations as and when necessary to ensure the effective implementation of the MOU and agreed minutes.

Annex I: Co-ordinates of MOU Area (‘The Box’) Internet

Annex II: Practical Guidelines for Implementing the 1974 MOU

1. Access to the MOU area would continue to be limited to Indonesian traditional fishermen using traditional methods and traditional vessels consistent with the tradition over decades of time, which does not include fishing methods or vessels utilising motors or engines.

2. The Indonesian traditional fishermen would continue to conduct traditional activities under the MOU in the area of the Australian Fishing Zone and the continental shelf adjacent to Ashmore Reef (Pulau Pasir) , Cartier Islet, Scott Reef, Seringapatam Reef and Browse Islet. In addition, Indonesian traditional fishermen would be able to conduct traditional fishing activities in an expanded area as described in the sketch map and coordinates attached to Annex 1 of the Agreed Minutes.

3. To cope with the depletion of certain stocks of fish and sedentary species in the Ashmore Reef (Pulau Pasir)  area, the Australian Government had prohibited all fishing activities in the Ashmore Reef National Nature Reserve, but was expected soon to adopt a management plan for the Reserve which might allow some subsistence fishing by the Indonesian traditional fishermen. The Australian side indicated that Indonesia would be consulted on the draft plan. Because of the low level of stock, the taking of sedentary species particularly Trochus nilotocus in the Reserve would be prohibited at this stage to allow stocks to recover. The possibility of renewed Indonesian traditional fishing of the species would be considered in future reviews of the management plan.

4. As both Australia and Indonesia are parties to CITES, Officials agreed that any taking of protected wildlife including turtles and clams would continue to be prohibited in accordance with CITES.

5. Indonesian traditional fishermen would be permitted to land on West Islet for the purpose of obtaining supplies of fresh water. The Indonesian side indicated its willingness to discourage Indonesian traditional fishermen from landings on East and Middle Islets because of the lack of fresh water on the two islets.

Appendix B: Memorandum of Understanding Between the Government of Australia and the Government of the Republic of Indonesia Regarding the Operations of Indonesian Traditional Fishermen in Areas of the Australian Exclusive Fishing Zone and Continental Shelf (7 November 1974)

Following discussions held in Jakarta on 6 and 7 November, 1974, the representatives of the Government of Australia and of the Government of the Republic of Indonesia have agreed to record the following understandings.

1. These understandings shall apply to operations by Indonesian traditional fishermen in the exclusive fishing zone and over the continental shelf adjacent to the Australian mainland and offshore islands.

By “traditional fishermen” is meant the fishermen who have traditionally taken fish and sedentary organisms in Australian waters by methods which have been the tradition over decades of time.

By “exclusive fishing zone” is meant the zone of waters extending twelve miles seaward off the baseline from which the territorial sea of Australia is measured.

2. The Government of the Republic of Indonesia understands that in relation to fishing in the exclusive Australian fishing zone and the exploration for and exploitation of the living natural resources of the Australian continental shelf, in each case adjacent to:

Ashmore Reef (Pulau Pasir) (Latitude 12° 15’ South, Longitude 123° 03’ East), Cartier Islet (Latitude 12° 32’ South, Longitude 123° 33’ East), Scott Reef (Latitude 14° 03’ South, Longitude 121° 47’ East), Seringapatam Reef (Pulau Datu) (Latitude 11° 37’ South, Longitude 122° 03’ East), Browse Islet (Latitude 14° 06’ South, Longitude 123° 32’ East).

The Government of Australia will, subject to paragraph 8 of these understandings, refrain from applying its laws regarding fisheries to Indonesian traditional fishermen who conduct their operations in accordance with these understandings.

3. The Government of the Republic of Indonesia understands that, in the part of the areas described in paragraph 2 of these understandings where the Government of Australia is authorised by international law to regulate fishing or exploitation for or exploitation of the living natural resources of the Australian continental shelf by foreign nationals, the Government of Australia will permit operations by Indonesian nationals subject to the following conditions:

a) Indonesian operations in the areas mentioned in paragraph 2 of the understandings shall be confined to traditional fishermen.

b) Landings by Indonesian traditional fishermen shall be confined to East Islet (Latitude 12° 15’ South, Longitude 123° 07’ East), and Middle Islet (Latitude 12° 15’ South, Longitude 123° 03’ East) of Ashmore Reef (Pulau Pasir) for the purposes of obtaining supplies of fresh water.

c) Traditional Indonesian fishing vessels may take shelter within the island groups described in paragraph 2 of these understandings but the persons on board shall not go ashore except as allowed in (b) above.

4. The Government of the Republic of Indonesia understands that the Indonesian will not be permitted to take turtles in the Australian exclusive fishing zone. Trochus, beche de mer, abalone, green snail, sponges and all molluscs will not be taken from the seabed from high water marks to the edge of the continental shelf, except the seabed adjacent to Ashmore and Cartier Islands, Browse Islet and the Scott and Seringapatam Reef.

5. The Government of the Republic of Indonesia understands that the persons on board Indonesian fishing vessels engaging in fishing in the exclusive Australian fishing zone or exploring for or exploiting the living natural resources of the Australian continental shelf, in either case in areas other than those specified in paragraph 2 of these understandings, shall be subject to the provisions of Australian law.

6. The Government of Australia understands that the Government of the Republic of Indonesia will use its best endeavours to notify all Indonesian fishermen likely to operate in areas adjacent to Australia of the contents of these understandings.

7. Both Governments will facilitate the exchange of information concerning the activities of the traditional Indonesian fishing boats operating in the area west of the Timor Sea.

8. The Government of the Republic of Indonesia understands that the Government of Australia will, until the twenty-eighth day of February 1975, refrain from applying its laws relating to fisheries to Indonesian traditional fishermen in areas of the Australian exclusive fishing zone and continental shelf other than those specified in paragraph 2 of these understandings.

Indonesia - Australia Fisheries Cooperation

The primary forum for fisheries and aquaculture cooperation between Australia and Indonesia is the Australia-Indonesia Working Group on Marine Affairs and Fisheries, under the auspices of the AIMF. The Working Group was established in June 2001 at a meeting between Australian Ministers and the Indonesian Minister for Marine Affairs and Fisheries, HE Dr Rokhmin Dahuri. Marine and fisheries issues had previously been progressed outside the AIMF and Ministers agreed to establish the Working Group as a way to institutionalise current collaboration across the spectrum of marine issues. The issues to be progressed in the Working Group primarily involve the fisheries, environment and scientific research portfolios, with DAFF taking the lead along with the Ministry of Marine Affairs and Fisheries in Indonesia. 

The Working Group aims to coordinate existing cooperation and facilitate future cooperation in the areas of fisheries and aquaculture management, research and development, marine environmental conservation and marine biotechnology research and development. The first meeting of the Working Group was held in April 2002, and several areas for cooperation were agreed upon:

cooperation to combat illegal, unreported and unregulated fishing

---fisheries management

---aquaculture development

---the marine environment

---marine biotechnology

---fishery products, safety, quality, product development and trade promotion

education, training and capacity building

poverty reduction, and

---marine, coastal and small islands development and management.

The Working Group met again in March 2003 to progress practical marine and fisheries cooperation between Australia and Indonesia. Particular areas for discussion included illegal fishing and management of the MoU Box (see below).

DAFF also facilitates a regional meeting between Australian, Indonesian and East Timorese fisheries officials on an annual basis (as part of the Northern Australia Fisheries Managers Workshop) and the outcomes of this meeting will flow back through to the Working Group. 

The Agreement between the Government of Australia and the Government of the Republic of Indonesia Relating to Cooperation in Fisheries (1992 Fisheries Cooperation Agreement) provides a framework for fisheries and marine cooperation between Australia and Indonesia, and provides for information exchange on research, management and technological developments, complementary management of shared stocks, training and technical exchanges, aquaculture development, trade promotion and cooperation on illegal fishing. Consultations under the Agreement have been held annually (where possible), and it was agreed in April 2002 that further cooperation under the Agreement would be undertaken within the auspices of the Working Group on Marine Affairs and Fisheries. 

Penulis : Drs.Simon Arnold Julian Jacob