Published online by Cambridge University Press: 07 July 2009
East Timor will soon achieve full independence and statehood. Its initial concerns as a newly independent state are political and economic stability. The current UN presence in East Timor should help ensure that the former concern is addressed so that the transition from a war torn non self-governing territory to a democratically elected government proceeds as smoothly as possible. The latter concern over East Timor's future economic stability is currently tied-up with continuing negotiations over the division of oil and gas revenues derived from a joint development arrangement, namely the Timor Gap Zone of Co-operation Treaty. This bilateral treaty was initially agreed in 1989 between Indonesia, which controlled East Timor from 1975 to 1999, and Australia. Its terms are currently being enforced on a provisional basis as agreed between the United Nations Transitional Administration of East Timor (UNTAET) and Australia while its future is being negotiated.
1. For a recent account of East Timor's rocky road to full independence and statehood, see Smith, A. L., ‘East Timor's Difficult Transition to Independence’, in Daljit, Singh and Freeman, N.J., eds., Regional Outlook: Southeast Asia 2001–2002 (Singapore, Institute of Southeast Asian Studies 2001).Google Scholar
2. For an analysis of the legal authority of the UN presence in East Timor, see Matheson, M.J., ‘United Nations Governance of Post Conflict Societies’, 95 AJIL (2001) pp. 76–85, at pp. 81–83.CrossRefGoogle Scholar
3. Full title: Treaty between the Australia and the Republic of Indonesia on the Zone of Co-operation in an Area between the Indonesian Province of East Timor and Northern Australia, signed (in the airspace) over the Timor Gap on 11 December 1989; entered into force on 9 February 1991. (hereinafter: the Timor Gap treaty) Sources: 29 ILM (1990) 469 and Prescott, V., ‘Australia-Indonesia (Timor Gap)’, Report No. 6–2(5), in Charney, J.I. and Alexander, L.M., eds., International Maritime Boundaries, Vol. II (The Hague, Martinus Nijhoff 1993) at pp. 1245–1328Google Scholar. Also in Fox, H., ed., Joint Development of Offshore Oil and Gas, Vol. II, Part III (London, The British Institute of International and Comparative Law 1990) pp. 235–251Google Scholar. For an early analysis of the background and main features of the Treaty, see Forbes, V.L. and Auburn, F. M., ‘The Timor Gap Zone of Co-operation’, Boundary Briefing (1991) No. 9.Google Scholar
4. Full Title: Memorandum of Understanding between the Government of Australia and the United Nations Transitional Administration in East Timor (UNTAET), acting on behalf of East Timor, on Arrangements Relating to the Timor Gap Treaty, 10 February 2000. Adopted in an Exchange of Notes constituting an Agreement between the Government of Australia and the United Nations Transitional Administration in East Timor (UNTAET) concerning the continued operation of the treaty between Australia and the Republic of Indonesia on the Zone of Co-operation between the Indonesian Province of East Timor and Northern Australia of 11 December 1989. Performed at Dili, 10 February 2000. Entry into force: 10 February 2000, but with effect from 25 October 1999. This arrangement was brought into force by an exchange of Diplomatic Notes on 10 February 2000 that retrospectively applied the provisional agreement as from 25 October 1999, i.e., the date when UNTAET took over government functions on behalf of East Timor. See Australian Treaty Series 2000, No. 9, accessed at the following website: http://www.auslii.edu.au/au/other/dfat/treaties/2000/9.html> In April 2000 Australia approved legislation giving effect to the above treaty with UNTAET. See Timor Gap Treaty (Transitional Arrangements) Act 2000.
5. Grant, for example, notes that ‘the legal status of East Timor should not be ignored as a factor in the movement of the territory from de facto province of Indonesia to independent state in statu nascendi.’ See Grant, T.D., ‘East Timor, the UN System, and Enforcing Non-Recognition in International Law’, 33 Vanderbilt JIL (2000) pp. 273–310, at p. 275Google Scholar. Moreover, as Crawford notes, ‘[t]he capacity of entities in statu nascendi to acquire rights under other forms of international arrangement is also a matter of some difficulty.’ See Crawford, J., The Creation of States in International Law (Oxford, Clarendon Press 1979) at p. 394.Google Scholar
6. Namely, the National Council of Timorese Resistance (CNRT), an umbrella group composed of different political hues, presided over by Xanana Gusmao.
7. Triggs reports that the first round of negotiations ended inconclusively and a new round had not yet been convened by the end of 2000, see Triggs, G., ‘Legal and Commercial Risks of Investment in the Timor Gap’, 1 Melbourne JIL (2001) pp. 98–130, at p. 99Google Scholar, citing UNTAET, First Round of Timor Gap Talks Ends, Daily Briefing (12 October 2000)Google Scholar Marks reports that further talks in Melbourne also ended without agreement in April 2001. See Marks, K., ‘East Timor claims oil and gas rights’, The Independent, UK newspaper (Friday 20 April 2001) at p. 19.Google Scholar
8. Agreement between the Government of the Commonwealth of Australia and the Government of the Republic of Indonesia Establishing Certain Seabed Boundaries, signed at Canberra on 18 May 1971 and the Agreement between the Government of the Republic of Indonesia and the Government of the Commonwealth of Australia Establishing Certain Seabed Boundaries in the Area of the Timor and Arafura Seas, Supplementary to the Agreement of 18 May 1971 signed at Jakarta on 9 October 1972. See V. Prescott, ‘Australia-Indonesia (Seabed Boundaries)’, Report No. 6–2(1) & ‘Australia-Indonesia (Timor and Arafura Seas)’, Report No. 6–2(2) in Charney and Alexander, eds., op. cit. n. 3, at pp. 1195–1205, 1207–1218, respectively.
9. Portugal was designated as the ‘Administering Power’ of East Timor by UNGA Resolution 1542 (XV) of 15 December 1960.
10. Antonio Cassese, Self-Determination of Peoples: A Legal Reappraisal (Cambridge, Cambridge University Press 1995) at p. 224.Google Scholar
11. The question of East Timor has been the subject of two UN Security Council Resolutions and eight General Assembly resolutions. See UNSC Res. 384 (1975) adopted on 22 December 1975, YUN (UN Yearbook) (1975) at p. 866; and UNSC Res. 389 (1976) adopted on 22 April 1976, YUN (1976); and UNGA Res. 3485 (1975) of 12 December 1975, YUN (1975) at p. 865; UNGA Res. 31/53 of 1 December 1976, YUN (1976) at p. 754; UNGA Res. 32/34 of 28 November 1977, YUN (1977) at p. 890; UNGA Res. 33/39 of 13 December 1978, YUN (1978) at p. 869; UNGA Res. 34/40 of 21 November 1979, YUN (1979) at p. 1056; UNGA Res. 35/27 of 11 November 1980, YUN (1980) at p. 1094; UNGA Res. 36/50 of 24 November 1981, YUN (1981) at p. 1185; UNGA Res. 37/30 of 23 November 1982, YUN (1982) at p. 1349.
12. See Sybesma-Knol, N., ‘The Indispensable Parties Rule in the East Timor Case’, in Denters, E. and Schrijver, N., eds., Reflections on International Law from the Low Countries: in Honour of Paul de Waart, (The Hague, Martinus Nijhoff 1998) pp. 442–457, p. at 445.Google Scholar
13. Calvocoressi, for example, notes that both Portugal and Australia implicitly acquiesced in the Indonesian invasion of East Timor, while ‘[T]he rest of the world hardly noticed.’ See Calvocoressi, P., World Politics since 1945, 6th edn. (London, Longman 1991) at p. 472Google Scholar. Cassese postulates that the general apathy displayed by the international community, which amounted to the effective tolerance of the Indonesian occupation of East Timor, can be accounted for by political considerations, in particular the strategic importance of Indonesia for the West. See Cassese, op. cit. n. 10, at p. 227. On the other hand, Symmons observes that the number of recognising states in fact constituted very much a minority of the world community, comprising mainly some Asian and neighbouring states of Indonesia and no European states at all. Moreover, of this small number of states, only Australia expressly recognised the Indonesian take-over de jure by the negotiation of the Timor Gap treaty. See Symmons, C.R., ‘The International Recognition Position Regarding the Purported Incorporation of East Timor into Indonesia’, in Leite, P. Pinto, ed., The East Timor Problem and the Role of Europe (Lisbon International Platform of Jurists for East Timor (IPJET) 1998) pp. 211–221, at p. 221.Google Scholar
14. See Suter, K., ‘Timor Gap Treaty: The continuing controversy’, 17 Marine Policy (1993) pp. 294–302, at p. 302.CrossRefGoogle Scholar
15. The action brought by Portugal against Australia challenged the rights of both Indonesia and Australia to enter into any agreement over the exploitation of hydrocarbons in the continental shelf area pertaining to East Timor. See Case Concerning East Timor (Portugal v. Australia) Judgment, ICJ Rep. (1995) 90 and 34 ILM (1995) 1581. See also Scobbie, I., ‘The East Timor Case: The Implications of Procedure for Litigation Strategy’, 9 Oil and Gas Law and Taxation Review (1991) pp. 273–281Google Scholar; and Kaye, S., Australia's Maritime Boundaries, Wollongong Papers on Maritime Policy No. 4 (Wollongong, Australia: Centre for Maritime Policy 1995) pp. 75–78.Google Scholar
16. Case Concerning East Timor, ICJ Rep. (1995) ibid., at para. 38, p. 106.
17. Ibid., at paras. 33 and 34, pp. 104–105.
18. Ibid., at para. 35, p. 105. Several of the legal issues raised by this case, namely, the Court's jurisdiction, the legal effect of the right of self-determination, and the legality of the Indonesian occupation of East Timor have been discussed in the pages of this Yearbook. See Antonopoulos, C., ‘Effectiveness v. the Rule of Law Following the East Timor Case’, 27 NYIL (1996) pp. 75–111CrossRefGoogle Scholar. See also Simpson, G.J., ‘Judging the East Timor Dispute: Self-Determination at the International Court of Justice’, 17 Hastings I & CLR (1994) p. 323.Google Scholar
19. It is important to note however, that the Court was careful to state that its conclusion over its lack of jurisdiction in the instant case did not extend to other Australian objections, including the Court's jurisdiction to decide on the validity of the 1989 Timor Gap treaty. See ICJ Rep. (1995) supra n. 15, at para. 35, p. 105.
20. The UN-sponsored referendum on East Timor's future took place on 30 August, 1999. The vote was organised by UNAMET (UN Mission in East Timor), the predecessor organisation to the present UNTAET (UN Transitional Administration in East Timor). Indonesia agreed to allow the ballot after two days of extensive negotiations in New York between the UN Secretary-General, Kofi Annan and the Indonesian and Portugese foreign ministers during March 1999. The agreement allowed both local East Timorese (pop. 600,000) and the East Timorese diaspora living all over the world (30,000), the majority being in Portugal, Australia and Macau, to participate in a direct ballot to decide whether the territory remained part of Indonesia, or became independent. See Aglionby, J., ‘UN pressure gives East Timor vote on independence’, The Guardian, UK newspaper (Saturday, 13 03 1999) at p. 18.Google Scholar
21. Following a strong voter turn-out (98.6%), UN Secretary General Kofi Annan announced on 4 September 1999, that the result was an overwhelming vote in favour of independence for East Timor. Almost eighty per cent (78.5%) of those registered to vote rejected a proposal for autonomy within Indonesia, thereby supporting East Timor's separation from Indonesia.
22. Cady, for example, observes that in the three weeks following the UN referendum East Timor was almost completely destroyed. 78% of public and private buildings were rendered unusable. Water, electricity, telephone and telecommunications systems, public services, hospitals, the banking system, businesses, infrastructure, the police, national and local institutions, archives – all collapsed. See Cady, J.-C., Deputy Transitional Administrator of East Timor, ‘Building the New State of East Timor’, Lecture for the Centre of International and Public Law (CIPL) (Canberra, Australia National University on 18 May 2000)Google Scholar. Text available from the CIPL and accessible at http://law.anu/edu/au/centres/CIPL/WEB22-0.7.htm (Conferences and Lectures 2000)
23. Indonesia renounced her claims to East Timor on 20 October 1999. In November 1999, the Indonesian People's Consultative Assembly met and officially accepted the result of the East Timor referendum vote.
24. On 25 October 1999, by unanimously adopting UNSC Resolution 1272 (1999), the UN Security Council established UNTAET for an initial period until 31 January 2001. It is responsible for the administration of East Timor and empowered to exercise all legislative and executive authority, including the administration of justice. The Security Council also mandated UNTAET to provide security and maintain law and order throughout East Timor; ensure the co-ordination and delivery of humanitarian, rehabilitation and development assistance; support capacity-building for self-government; and assist in the establishment of conditions for sustainable development. See UNSC res. 1272, 4057th Meeting (am), 25 October 1999, UN Doc. S/RES/1272 (1999) Also see 39 ILM (2000) 240. The Security Council established the UNTAET for an initial period until 31 January 2001.
25. See Findlay, T., Cambodia: The Legacy and Lessons of UNTAC, SIPRI Research Report No. 9 (Stockholm/Oxford, Stockholm International Peace Research Institute/Oxford University Press 1995)Google Scholar See also Institute of Policy Studies of Singapore and UN Institute for Training and Research (UNITAR), The UN Transitional Authority in Cambodia (UNTAC): Debriefing and Lessons, Report of the 1994 Singapore Conference (London, Kluwer Law International 1995).Google Scholar
26. See Schrijver, N., Sovereignty over Natural Resources: Balancing Rights and Duties (Cambridge, Cambridge University Press 1997) at p. 147.CrossRefGoogle Scholar
27. See Onorato, W.T. and Valencia, M.J., ‘The New Timor Gap Treaty: Legal and Political Implications’, 15 ICSID Review – Foreign Investment Law Journal (2000) pp. 59–85.CrossRefGoogle Scholar
28. Negotiations are presently continuing in Dili (East Timor) between the UNTAET and Australia on a new arrangement to replace the current Timor Gap treaty regime. See UNTAET, ‘First Round of Timor Gap Talks Ends’, Daily Briefing (12 October 2000)
29. See McBeth, J., ‘Pipe Dreams’, Far Eastern Economic Review (31 August 2000) at p. 18Google Scholar. See also the comments of Man Alkatiri of the National Council of Timorese Resistance, as quoted in Alford, P. and Garran, R., ‘East Timor Wants New Gap Treaty’, The Australian, Sydney newspaper (15 June 2000) at p. 2Google Scholar; and those of UNTAET's head, de Mello, S. Vieria, ‘East Timor Receives First Royalty Payment from Oil Exploitation in Timor Gap’, in UNTAET, Press Release (24 October 2000).Google Scholar
30. Marks, loc. cit. n. 7, at p. 19.
31. McBeth, loc. cit. n. 29.
32. Available at http://www.aph.gov.au/senate/committee/fadt.ctte.
33. Triggs, loc. cit. n. 7, at p. 125.
34. For example, Sect. IV, para. 1 of the Conclusions and Recommendations of the lawyers' group at the Second Workshop on Geology and Hydrocarbon Potential in the South China Sea and Possibilities of Joint Development, held in Honolulu during August 1983 defined ‘joint development’ as extending from unitization of shared resources to unilateral development of a shared resource beyond a stipulated boundary, and various gradations in between. See Miyoshi, M., ‘The Basic Concept of Joint Development of Hydrocarbon Resources on the Continental Shelf’, 3 International Journal of Estuarine (now Marine) and Coastal Law (1988) pp. 1–18, at p. 5 and Appendix II, at p. 17.CrossRefGoogle Scholar
Gault defines ‘joint development’ as ‘a decision by one or more countries to pool any rights they may have over a given area and, to a greater or lesser degree, undertake some form of joint management for the purposes of exploring and exploiting offshore minerals.’ See Townsend-Gault, I., ‘Joint Development of Offshore Mineral Resources - Progress and Prospects for the Future’, 12 Natural Resources Forum (1988) at p. 275.CrossRefGoogle Scholar
Lagoni restricted the scope of ‘joint development’ to co-operation between states with regard to the exploration for and exploitation of certain deposits, fields or accumulations of non-living resources, which either extend across a boundary or lie in an area of overlapping claims. See International Law Association, International Committee on the EEZ, ‘Joint Development of Non-Living Resources in the Exclusive Economic Zone’ Report of the Sixty-Third Conference, Warsaw (1988). Rapporteur: R. Lagoni (hereinafter, 1988 ILA Warsaw Report) pp. 509–558, at pp. 511–512.
Miyoshi too favours a restrictive version of ‘joint development’, limited to an inter-governmental agreement, to the exclusion of joint ventures between a government and an oil company, or a consortia of private companies for capital participation. He therefore defines ‘joint development’ as an inter-governmental arrangement of a provisional nature, designed for functional purposes of joint exploration for and/or exploitation of the hydrocarbon resources of the sea-bed beyond the territorial sea. See Miyoshi, M., ‘Basic Legal Issues of Joint Development of Offshore Oil and Gas in relation to Maritime Boundary Delimitation’, Maritime Briefing, Vol. 2, No. 5 (Durham, International Boundaries Research Unit (IBRU) 1999) at p. 4.Google Scholar
Finally, the British Institute of International and Comparative Law (BIICL) Research Team's definition of ‘joint development’ is an agreement between two states to develop so as to share jointly in agreed proportions by inter-state co-operation and national measures the offshore oil and gas in a designated zone of the seabed and subsoil of the continental shelf to which both or either of the participating states are entitled in international law. See Fox, H., et al. , Joint Development of Offshore Oil and Gas, Vol. I (London, British Institute of International and Comparative Law 1988) at p. 45.Google Scholar
35. Other examples of joint development agreements include the following: Agreement concerning the Delimitation of the Continental Shelf in the Persian Gulf between the Shaykhdom of Bahrain and the Kingdom of Saudi Arabia, 22 February 1958, in Churchill, R., Nordquist, M. and Lay, S. Houston, eds., New Directions in the Law of the Sea, Vol. 5 (Dobbs Ferry, NY, Oceana Publications 1973) pp. 207–211Google Scholar, ST/LEG/SER.B/16, 409; Agreement between the state of Kuwait and the Kingdom of Saudi Arabia Relating to the Partition of the Neutral Zone, 7 July 1965, in 4 ILM (1965) p. 1134; Agreement on the Settlement of Maritime Boundary Lines and Sovereign Rights over Islands between Qatar and Abu Dhabi, 20 March 1969, ST/LEG/SER.B/16, 403; Memorandum of Understanding between Iran and Sharjah, 18 November 1971, Middle East Economic Survey, Vol. 15, No. 28 (1972) Supplement; Convention between the Government of the French Republic and the Government of the Spanish state on the delimitation of the Continental Shelf of the Two states in the Bay of Biscay, 29 January 1974, ST/LEG/SER.B/19, 445, Agreement between Japan and the Republic of (South) Korea concerning Joint Development of the Southern Part of the Continental Shelf adjacent to the Two Countries, 5 February 1974, in Churchill et al., Vol. 4 (1975) pp. 117–133; Agreement between Sudan and Saudi Arabia relating to the Joint Exploitation of the Natural Resources of the Sea-Bed and Sub-soil of the Red Sea in the Common Zone, 16 May 1974, ST/LEG/SER.B/18 452–5; Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Kingdom of Norway relating to the Exploitation of the Frigg Field Reservoir and the Transmission of Gas therefrom to the United Kingdom, 10 May 1976, entered into force: 22 July 1977, UKTS (1977) 113; Memorandum of Understanding between Malaysia and the Kingdom of Thailand on the Establishment of a Joint Authority for the Exploitation of the Resources in the Sea-Bed in a Defined Area of the Continental Shelf of the Two Countries in the Gulf of Thailand, 21 February 1979, entered into force: 24 October 1979, in Appendix I of Ong, D., ‘Thailand/Malaysia: The Joint Development Agreement 1990’, 6 International Journal of Estuarine (now Marine) and Coastal Law (1991) pp. 57–72, at pp. 61–63CrossRefGoogle Scholar. Followed by the Agreement between the Government of Malaysia and the Government of the Kingdom of Thailand on the Constitution and Other Matters relating to the Establishment of the Malaysia-Thailand Joint Authority, 30 May 1990, in Appendix II of Ong, pp. 64–72; Agreement on the Continental Shelf between Iceland and Norway, 22 October 1981, 21 ILM (1982) pp. 1222–1226; Memorandum of Understanding between Malaysia and Vietnam for the exploration and exploitation of petroleum in the Gulf of Thailand, 5 June 1992, entered into force: 4 June 1993. See T.L. McDorman, ‘Malaysia-Vietnam’, Report No. 5–19, in Charney and Alexander, Vol.III, op. cit. n. 3, at pp. 2335–2344, text of MOU at pp. 2341–2344; Maritime Delimitation Treaty between Jamaica and the Republic of Colombia, 12 November 1993, entered into force: 14 March 1994, see K.G. Nweihed, ‘Colombia-Jamaica’, Report 2–18, in Charney and Alexander, Vol. III, op. cit. n. 3, at pp. 2179–2204; Management and Co-operation Agreement between the Government of the Republic of Senegal and the Government of the Republic of Guinea-Bissau, 14 October 1993, and Protocol of Agreement relating to the Organization and Operation of the Agency for Management and Co-operation between Senegal and Gunea-Bissau, 12 June, 1995, both entered into force: 21 December 1995, 31 LOS Bull. 40 & 42, respectively (1996). See also J. R. V. Prescott, ‘Guinea-Bissau-Senegal’, Report 4–4(4) & (5) in Charney and Alexander, Vol. III, op. cit. n. 3, at pp. 2251–2278. Joint Declaration of Argentina and the United Kingdom on Co-operation over Offshore Activities in the South West Atlantic, 27 September 1995, 35 ILM (1996) p. 301, ‘Current Developments: UK-Argentina’, 11 International Journal of Marine and Coastal Law (1996) pp. 113–118Google Scholar, see also Churchill, R.R., ‘Falkland Islands - Maritime Jurisdiction and Co-operative Arrangements with Argentina’, 46 ICLQ (1997) pp. 463–477.CrossRefGoogle Scholar
36. Specifically, the North Sea, Middle East and East and Southeast Asian regions, and more recently, the Caribbean Sea (Jamaica/Colombia, 1993), eastern (Senegal/Guinea-Bissau, 1993/1995) and southwestern (UK/Argentina, 1995) Atlantic regions. See List of joint development and transboundary unitization agreements, supra n. 35.
37. For a fuller discussion of this issue, see Ong, David M., ‘Joint Development of Common Offshore Oil and Gas Deposits: ‘Mere’ State Practice or Customary International Law?’, 93 AJIL (1999) pp. 771–804.CrossRefGoogle Scholar
38. Arbitral Tribunal Award, 17 December 1999. Accessed from: <http://www.pca-cpa.org>
39. Ibid., at para. 84.
40. Reisman, W.M., ‘Eritrea-Yemen Arbitration Award Phase II-Maritime Delimitation’, International Decisions, 94 AJIL (2000) pp. 721–736, at p. 735.CrossRefGoogle Scholar
41. Under Art. 1(o), Annexes A, B, C, and D are included within the meaning of the ‘Treaty’. Annex A contains the designation and description including maps and coordinates of the areas A, B and C comprising the Zone of Cooperation and is incorporated into the Treaty by Art. 1. Annex B contains the Petroleum Mining Code for Area A of the Zone of Cooperation. This Code governs operational activities relating to exploration and exploitation of the petroleum resources in Area A subject to the power of the Ministerial Council under Art. 6.1(b) of the Treaty to amend it (Art. 1.1(i)) Annex C to the treaty contains the Model Production Sharing Contract between the Joint Authority and contractors on the basis of which production sharing contracts for Area A are to be concluded subject to modification by the Ministerial Council under Art. 6.1(c) of the treaty (Art. 1.1(g)).
42. For an early analysis of its provisions see Bergin, A., ‘The Australian-Indonesian Timor Gap Maritime Boundary Agreement’, 5 International Journal of Estuarine (now Marine) and Coastal Law (1990) pp. 383–393CrossRefGoogle Scholar. It should be noted however that unique as the Timor Gap treaty is, it is but one of three such joint development arrangements in Southeast Asian waters alone. The other two are: The 1979 Memorandum of Understanding between Thailand and Malaysia establishing a Joint Authority for the exploitation of the resources of the sea-bed in a defined area of the continental shelf of the two countries in the Gulf of Thailand, followed by the 1990 Agreement between the same two countries on the Constitution and other matters relating to the establishment of the Malaysia-Thailand Joint Authority, both texts in Ong, loc. cit. n. 35, at pp. 57–72. Also, the 1992 Memorandum of Understanding between Malaysia and the Socialist Republic of Vietnam for the exploration and exploitation of petroleum in a defined area of the continental shelf involving the two countries, in McDorman, Vol. III, op. cit. n. 35, at p. 2341.
43. Onorato, W.T. and Valencia, M.J., ‘International Cooperation for Petroleum Development: the Timor Gap Treaty’, Vol. 5, ICSID Review – Foreign Investment Law Journal (1990) No. 1, pp. 1–29, at p. 26.CrossRefGoogle Scholar
44. Burmester, H., ‘The Zone of Co-operation between Australia and Indonesia: A Preliminary Outline with Particular Reference to Applicable Law’, in Fox, H., ed., Joint Development of Offshore Oil and Gas, Vol. II, (London, The British Institute of International & Comparative Law 1990) pp. 128–140, at pp. 129–130.Google Scholar
45. This is a line drawn on maritime charts that traces every point of a specified ocean water depth.
46. See North Sea Continental Shelf cases (1969) ICJ Rep. p. 3, at paras. 19 and 43, where the principle of natural prolongation as the legal basis for both the continental shelf regime itself, and the extent of its outer limits, was elaborated. For a recent examination of the relationship between natural prolongation and the delimitation of maritime boundaries, see Zahraa, M., ‘Natural Prolongation and Delimitation of Maritime Boundaries’, VII FYBIL (1996) pp. 378–403.Google Scholar
47. The use of the Timor Trough or Trench as a relevant circumstance to be taken into account in any continental shelf delimitation between East Timor and Australia based on the natural prolongation principle had been noted by Brown. See Brown, E.D., ‘The Anglo-French Continental Shelf Case’, 16 San Diego LR (1979) p. 461, at p. 477Google Scholar, as cited in Zahraa, loc. cit. n. 46, at pp. 381–382, n. 24.
48. Art. 76(1) of this Convention provides that ‘The continental shelf of a coastal state comprises the sea-bed and subsoil of the submarine areas that extend beyond its territorial sea throughout the natural prolongation of its land territory to the outer edge of the continental margin, or to a distance of 200 nautical miles from the baselines from which the breadth of the territorial sea is measured where the outer edge of the continental margin does not extend up to that distance.’
49. See Continental Shelf case (Libya v. Tunisia) ICJ Rep. (1982) p. 18, where the Court held that natural prolongation was not the only important criteria to be considered when establishing the appropriate continental shelf boundary; and Continental Shelf case (Libya v. Malta) ICJ Rep. (1985) p. 13, at p. 35, where the Court further marginalised natural prolongatioń as a relevant criterion in all cases within the 200-nautical mile limit.
50. Art. 2 of the 1989 Timor Gap treaty, op. cit. n. 3.
51. Ibid., Art. 4(1).
52. Ibid., Art. 4(2).
53. Ibid., Art. 2(2)(a) and 3.
54. Ibid., Part III, Arts. 5 and 6.
55. Ibid., Part IV, Arts. 7–11.
56. Ibid. Based on a model production-sharing contract in Annex C.
57. Unlike the Malaysia-Thailand Joint Authority, for example, which ostensibly at least retains control over all aspects of policy and decision-making for the exploration and exploitation of the non-living natural resources in the Joint Development Area. See Art. 3(2) of the 1979 Memorandum of Understanding and Art. 7(1) of the 1990 Agreement on the Constitution of the Joint Authority. For analysis of this issue, see Ong, D.M., ‘The 1979 and 1990 Malaysia-Thailand Joint Development Agreements: A Model for International Legal Co-operation in Common Offshore Petroleum Deposits?’, 14 International Journal of Marine and Coastal Law (1999) pp. 207–246, at p. 233.Google Scholar
58. Art. 6 of the Timor Gap treaty, op. cit. n. 3.
59. Ibid., Arts. 7(3) and (8).
60. Ibid., Art. 5(1).
61. Ibid., Art. 5(2).
62. Ibid., Art. 5(3).
63. Ibid., Art. 5(4).
64. Ibid., Art. 5(5).
65. Ibid., Art. 6(1).
66. Ibid., Art. 6(1)(a)–(r).
67. Ibid., Art. 6(2).
68. Ibid., Art. 7(1).
69. Ibid., Art. 7(2)
70. Ibid., Art. 7(3).
71. Ibid., Art. 9(1)(a).
72. Ibid., Art. 9(1)(b)(i)–(iii).
73. Ibid., Art. 9(1)(c).
74. Ibid., Art. 9(2)
75. Ibid., Art. 9(4).
76. Ibid., Art. 9(5).
77. Ibid., Art. 7(4).
78. Ibid., Art. 7(5).
79. Ibid., Art. 8.
80. Ibid., Art. 8(a)–(h).
81. Ibid., Art. 8(i)–(u).
82. Again in contrast with the Malaysia-Thailand Joint Authority which also has control over the other non-living resources aside from merely petroleum. See Arts. 3(2) and 3(4) of the Memorandum of Understanding; and Ibid., Art. 7 of the 1990 Agreement on the Constitution of the Joint Authority.
83. Under Art. 7(2) of the Treaty, op. cit. n. 3.
84. Ibid., Art. 8(b).
85. Ibid., Art. 8(o). Annex C to the Treaty contains the Model Production Sharing Contract between the Joint Authority and contractors on the basis of which production sharing contracts for Area A are to be included concluded. Under Art. 1(o), Annexes A, B, C, and D are included within the meaning of the ‘Treaty’.
86. Ibid., Art. 18(1)(a) & (b).
87. Ibid., Art. 18(2).
88. Ibid., Art. 19.
89. Ibid., Art. 27(1).
90. Ibid., Art. 27(2)(a).
91. Ibid., Art. 27(2)(b).
92. Ibid., Art. 27(3).
93. Ibid., Art. 27(4)(a).
94. Ibid., Art. 27(5).
95. Ibid., Art. 28.
96. Ibid., Art. 22.
97. Ibid., Art. 23.
98. Ibid., Art. 24.
99. Ibid., Art. 25
100. Ibid., Art. 26.
101. Ibid., Art. 29.
102. Ibid., Art. 30(1).
103. Ibid., Art. 30(2).
104. Ibid., Art. 34(1)(a) and (b).
105. Onorato and Valencia, op. cit. n. 23, at p. 73.
106. The Bayu-Undan project involves two phased developments of the field's natural gas and gas liquids resources. The first phase of development in October 1999, comprising an initial expenditure of approximately US $ 1.4 billion on the liquids stripping/lean gas recycle phase makes it the largest investment proposed to date in the Timor Sea.
The Bayu-Undan field is located in the central Timor Sea about 500 km north west of Darwin Australia and about 250 km south of Suai in East Timor. The field straddles two production sharing contract (PSC) areas (91–12 and 91–13) in Area A of the Timor Gap Zone of Cooperation (ZOCA) just north of the EEZ boundary and median line between Australia and East Timor. The Bayu-Undan field is a single gas/condensate resource with recoverable reserves of approximately 400 million barrels of liquids (condensate and LPG) and 3.4 tcf of gas. The field life is estimated to be 25 years, with first liquids production planned to commence in late 2003.
A second phase downstream development to commercialise the field's valuable gas reserves is also planned and concepts for this are the subject of separate studies and approvals by the co-venture companies and government authorities.
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125. Ibid., at pp. 190–191.
126. Ibid., at pp. 204 and 222.
127. Ibid., at p. 194.
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148. When Indonesia signalled its acceptance of the result of the UN-sponsored referendum in East Timor, thereby allowing UNTAET to fulfil its mandate to administer the territory during its transition period to full independence and sovereignty.
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208. Ibid., at p. 48.
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261. Ibid., at para. 43.
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264. Ibid., at p. 67, para. 111.
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266. Ibid., at pp. 64–65, para. 104.
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268. See Art. 76 of the 1982 LOSC, supra n. 48.
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270. In this respect, both formal and informal talks between on the one hand, the UNTAET and the East Timor Transitional Administration (ETTA) and on the other hand, Australia have taken place through April and May 2001. Formal talks took place in Melbourne from 4–6 April 2001 and again in Dili on 28 May 2001.
271. UNTAET, Daily Press Briefing, Dili, 12 April 2001, accessed at: http://www.un.org/peace/etimor.
272. See Onorato and Valencia, op. cit. n. 27, at p. 80.
273. Ibid.
274. The second official round of talks in Melbourne between the UNTAET/ETTA and Australia were described by the ETTA Cabinet Member for Economic Affairs, Mari Alkatiri, as a ‘setback’.
275. Triggs, loc. cit. n. 7, at pp. 114–125.
276. As developed by the International Court of Justice in successive maritime boundary dispute cases beginning with the North Sea Continental Shelf cases (1969) supra n. 46.
277. As required by Art. 74(1) of the 1982 LOSC for EEZ delimitation and Art. 83(1) for continental shelf delimitation.
278. The literature on this issue is extensive and cannot be fully referred to here. Examples include: Blecher, M.D., ‘Equitable Delimitation of Continental Shelf’, 73 AJIL (1979) pp. 60–88CrossRefGoogle Scholar; Kwiatkowska, B., ‘Equitable Maritime Boundary Delimitation - A Legal Perspective’, 3 International Journal of Estuarine (now Marine) and Coastal Law (1988) pp. 287–304Google Scholar; Weil, P., The Law of Maritime Delimitation - Reflections (Cambridge, Grotius Publications 1989)Google Scholar; and Sharma, S.P., Delimitation of Land and Sea Boundaries Between Neighbouring Countries (New Delhi, Lancers Books 1989).Google Scholar
279. Art. 6(1) of the 1958 Continental Shelf Convention requiring the application of the median line in such situations in the absence of an agreement has been superceded in this respect by Arts. 74(1) and 83(1) of the 1982 LOSC, both in international conventional law and arguably also in customary international law.
280. See McKee, G.A., ‘The New Timor Gap: Will Australia now break with the past?’, No. 62Inside Indonesia (04–06 2000)Google Scholar citing J.J. Smith who argues that a new East Timor state will benefit from recent international law developments which ‘strongly suggest that a median line will ultimately form the EEZ boundary between East Timor and Australia.’ See also Tanter, R., Selden, M. and Shalom, S.R., ‘East Timor Faces the Future’, Vol. 32, Nos. 1 & 2Bulletin of Concerned Asian Scholars (01–06 2000) pp. 113–124, especially at pp. 118–120.Google Scholar
281. Full title: Treaty between the Government of Australia and the Government of the Republic of Indonesia establishing an Exclusive Economic Zone Boundary and Certain Seabed Boundaries, signed in Perth, Western Australia on 14 March 1997. Not yet in force. See http://www.austlii.edu.au/au/other/dfat/treaties/2000/index.html for text. The legal status of this agreement is presumably also being reappraised following the UN-sponsored referendum result and consequent relinquishment of Indonesian sovereignty over East Timor.
282. For an analysis of the possible legal problems raised by the overlapping nature of the Indonesian EEZ jurisdiction in the water column superjacent to the Australian continental shelf jurisdiction in some areas delimited by the 1997 Treaty, see Herriman, M. and Tsamenyi, M., ‘The 1997 Australia-Indonesia Maritime Boundary Treaty: A Secure Legal Regime for Offshore Resource Development?’, 29 Ocean Development & International Law (1998) pp. 361–396.CrossRefGoogle Scholar
283. As Churchill and Lowe note, ‘Although the provisions of the Convention governing continental shelf and EEZ boundaries are the same, their wording is sufficiently imprecise for the continental shelf and EEZ boundaries to differ - a situation fraught with potential conflict…’ See Churchill, R.R. and Lowe, A.V., The Law of the Sea, 3rd edn. (Manchester, Manchester University Press 1999) at p. 196.Google Scholar
284. For example, para. 7 of Malaysia's Declaration following her ratification of the 1982 LOSC on 14 October 1996, in accordance with Art. 310 of this Convention, states that: ‘The Malaysian Government interprets article 74 and article 83 to the effect that in the absence of agreement on the delimitation of the exclusive economic zone or continental shelf or other maritime zones, for an equitable solution to be achieved, the boundary shall be the median line, namely a line every point of which is equidistant from the nearest points of the baselines from which the breadth of the territorial sea of Malaysia and of such other states is measured. Malaysia is also of the view that in accordance with the provisions of the Convention, namely article 56 and article 76, if the maritime area is less [than] or to a distance of 200 nautical miles from the baselines, the boundary for the continental shelf and the exclusive economic zone shall be on the same line (identical).’ It should be noted that Art. 310 of the LOSC provides that the declarations or statements made by states when signing, ratifying or acceding to this Convention ‘do not purport to exclude or modify the legal effect of the provisions of this Convention in their application to that state.’
285. Churchill and Lowe note that ‘Since the late 1970s the trend, particularly outside Europe, has been to conclude agreements establishing a single maritime boundary for all zones … Of the single maritime boundaries that have so far been agreed, many, particularly in the case of opposite coasts, are based on the equidistance (or median) principle …’, op. cit. n. 284, at p. 197.
286. Using the threshold of proof applied by the Court in the North Sea Continental Shelf cases, for example. See ICJ Rep. (1969) at pp. 43–44, paras. 75–77.
287. Churchill and Lowe, op. cit. n. 283, at p. 196 [emphasis added].
288. See Kaye, S.B., ‘Multiple Boundaries in Maritime Boundary Delimitation: The Problems of Common Jurisdiction’, in Australia and New Zealand Societies of International Law (ANZSIL) Proceedings of the 6th Annual Conference, 1998 (Canberra, Centre for International and Public Law (CIPL), Australian National University 1999) pp. 185–193.Google Scholar
289. Churchill and Lowe note at least three cases where the proportionality principle was utilised, namely the Greenland v. Jan Mayen case, and the Libya v. Malta and Libya v. Tunisia cases. See Churchill and Lowe, op. cit. n. 283, at p. 189.
290. See Case Concerning the Continental Shelf (Libya v. Malta), Judgment, ICJ Rep. (1985) p. 13, at pp. 43–46 and 49–50.
291. Ibid., at p. 44, para. 74, citing ICJ Rep. (1969) at p. 54, para. 101.
292. Ibid., at p. 44, para. 74.
293. Ibid., at pp. 42–43, paras. 71–73.
294. See Brown, E.D., ‘The Libya-Malta Continental Shelf Case (1985)’, in Cheng, B. and Brown, E.D., eds., Contemporary Problems of International Law: Essays in honour of Georg Schwarzenberger on his eightieth birthday (London, Stevens & Sons 1988) pp. 3–18, at pp. 14–15Google Scholar, citing the Libya v. Malta Judgment at p. 49, para. 66.
295. Brown, Ibid., at p. 17.
296. See McKee, G.A., ‘The New Timor Gap: Will Australia now break with the past?’, No. 62Inside Indonesia (2000)Google Scholar. McKee is of the opinion that ‘a median line settlement under UNCLOS [sic] will enable East Timor to receive almost twice the benefit offered by a (Timor Gap) treaty Indonesia and Australia concluded in darker times.’ See also Tanter, Selden and Shalom who quote McKee as arguing that ‘the median line principle, which was given weight by Australia in the 1997 treaty with Indonesia, is significant for the new nation of East Timor since all the significant petroleum discoveries have been in the area north of the line. Thus East Timor may be entitled to the entire tax revenues.’ loc. cit. n. 280, at p. 119, citing a letter to the authors by McKee, dated 5 November 1999.
297. See Triggs, loc. cit. n. 7, at p. 125.
298. Ibid.
299. Eritrea-Yemen (1999) supra n. 38, at para. 86.
300. Ibid., at para. 86.
301. Art. 9 of the 1997 treaty provides that ‘[I]f any single accumulation of liquid hydrocarbons or natural gas, or if any other mineral deposit beneath the seabed, extends across the lines described in Arts. 1 and 3 of this Treaty, and the part of such accumulation or deposit that is situated on one side of the line is recoverable in fluid form wholly or in part from the other side of the line, the two Parties will seek to reach agreement on the manner in which the accumulation or deposit shall be most effectively exploited and on the equitable sharing of the benefits arising from such exploitation.
302. See UK-Norway Agreement Relating to the Exploitation of the Frigg Field Reservoir and the Transmission of Gas Therefrom to the United Kingdom, 10 May 1976, at 1977 UK TS No. 113 (Cmnd. 7043), 1098 UNTS 3. See Woodliffe, J.C., ‘International Unitization of an Offshore Gas Field’, 26 ICLQ (1977) at p. 338CrossRefGoogle Scholar. Similar agreements relating to the Murchison and Statfjord Fields were also concluded between the United Kingdom and Norway on 16 October 1979, 1981 UK TS No. 39 (Cmnd. 8270) & No. 44 (Cmnd. 8282). The Anglo-Dutch Agreement Relating to the Exploitation of the Markham Field Reservoirs and the Offtake of Petroleum Therefrom, 26 May 1992, is a similar type of international trans-boundary unitization agreement. See 1993 UK TS No. 38 (Cmnd. 2254).
303. See Ong, loc. cit. n. 57, pp. 788–792, where a typology of three different categories of joint development models is described.
304. Art. 2(2)(a) of the 1989 treaty, op. cit. n. 3.
305. Det Norske Veritas, Draft Technical Report of Frigg Field Cessation Environmental Impact Assessment, prepared for TotalFinaElf, Report No. 99–4030, at p. 4.
306. Koskenniemi, op. cit. n. 161, at p. 93.
307. Traub, J., ‘Inventing East Timor’, Vol. 79, No. 4, Foreign Affairs (2000) pp. 74–89, at p. 88.CrossRefGoogle Scholar
308. The gradual process towards laying the foundations for democratically elected government in East Timor is continuing and was recently boosted by the news that one of East Timor's biggest and best known political groups, Freitilin, which spearheaded the bloody 24-year struggle for independence from Indonesia has begun the process of transforming itself from a revolutionary front to a mainstream political party. See Dodd, M., Sydney Morning Herald, Australia newspaper (May 2000).Google Scholar
309. See Ong, op. cit. n. 57, at pp. 788–792, for a basic typology of the main joint development models adopted by states in their bilateral practice on this issue.