The New Timor Sea Treaty and Interim Arrangements for Joint Development of Petroleum Resources of the Timor Gap

Abstract

Under the Timor Sea Treaty of 2002, Australia and the newly independent East Timor have agreed upon joint development of the petroleum resources of the disputed Timor Gap. Until this treaty comes into force, an Exchange of Notes applies the terms of the 1989 Timor Gap Treaty, with Australia and East Timor as the implementing parties. Since gaining independence, East Timor has argued that under current principles of international law, it is entitled to a greater share of the Timor Sea's oil and gas resources than is suggested by the boundaries of the Timor Sea Treaty's Joint Petroleum Development Area ("JPDA"). Principally, East Timor asserts that the western and eastern lines defining the JPDA are ill-founded at international law, a claim that has immediate implications for the joint venture partners in the Greater Sunrise fields that straddle the JPDA's eastern boundary. This paper examines the legal background to the Timor Gap dispute, the agreements that have regulated resource exploitation of the area since 1989, the validity of the respective seabed rights of Indonesia, Australia and East Timor and finally, the impact of Australia's recent withdrawal of maritime boundary disputes from the jurisdiction of the International Court of Justice and the International Tribunal for the Law of the Sea.

JEL Classification: K33