SYDNEY Jan 9 Australia on Monday agreed to let
East Timor terminate an oil revenue treaty between the two
neighbours, a key step towards ending a maritime border dispute
that has prevented the development of a $40 billion offshore gas
Ending years of opposition, Foreign Minister Julie Bishop
said Australia would accept Dili's formal notice to terminate
the agreement to split petroleum revenue equally from the
Greater Sunrise fields and set a 50-year timetable for
negotiating a permanent sea boundary.
East Timor had sought for years to terminate the agreement,
after allegations Australia bugged the tiny Pacific Island
nation during treaty discussions in 2004. Australia has never
admitted nor denied the allegations.
Dili took the dispute to the Permanent Court of Arbitration,
which ordered compulsory arbitration between the two last
"The governments of Timor-Leste and Australia look forward
to continuing to engage with the Conciliation Commission and to
the eventual conclusion of an agreement on maritime boundaries
in the Timor Sea," the two countries said in a statement on
The existing maritime boundary is aligned with Australia's
continental shelf, but East Timor has long argued the border
should lie half way between it and Australia and put more of the
Greater Sunrise field under its jurisdiction.
The political dispute had led the owners of the Greater
Sunrise fields -- Woodside Petroleum, ConocoPhillips
, Royal Dutch Shell and Japan's Osaka Gas
-- to shelve the project.
The fields are estimated to hold 5.1 trillion cubic feet of
gas and 226 million barrels of condensates, which analysts have
estimated could be worth $40 billion.
"We look forward to an agreement that allows for the
earliest commercialisation of the Greater Sunrise fields, which
promise great benefits for all parties," Woodside, the operator
of the project, said in an emailed statement.
Earlier treaties that established a joint petroleum
development area with revenue split 90 percent to East Timor and
10 percent to Australia, which govern production from the
Bayu-Undan field run by ConocoPhillips, will remain in place.
(Reporting by Colin Packham and Sonali Paul; Editing by Randy