In response to Mr Alkairi’s Interview in LUSA (02-09-20) on Greater Sunrise Pipeline issues.
THE enter into the debate about destination of the Pipeline from the Greater Sunrise by Mr Mari Alkairi, the current Secretary General of Fretilin, makes it all interesting and exciting issue to be discussed. Mr Alkatiri’s statements in the interview clearly demonstrate the inconsistency in the Fretilin policies and actions. On one hand, as mentioned by Mr Alkatiri, Fretilin supports the policy of bringing the Pipeline to Timor-Leste; However, on the other hand, Mr Alkatiri said that “as long as it (Pipeline to Timor-Leste) is viable, and insisted to have an economic viability study, when he knows that the previous Government and petroleum leadership team have mentioned and shown repeatedly, and even, presented publicly including in the Parliament of the project details including the technical and commercial/economic viability of it. Mr Alkatiri also knows that there are tons of documents and reports of the studies been carried out by Timor-Leste State institutions on the matter, and these studies were done with reputable international oil and gas consultants/companies.
Another example of Fretilin inconsistency is when Fretilin voted against Maritime Boundary Treaty and the changes of Petroleum Fund Law for the acquisitions of the Greater Sunrise participating interest by TIMOR GAP. That acquisition decision was important to ensure higher revenue from the project to Timor-Leste (as it added another revenue stream through company’s take), and chances to influence and directing the fate/direction of the Greater Sunrise pipeline to Timor-Leste to increase socio-economic benefits of the project). All these acts of inconsistency in Fretilin’s position leads people to think that perhaps Fretilin is against Pipeline to Timor-Leste! Fretilin needs to make clear, firm and unshakeable position/policy on this issue! Without this is, in my view, Fretilin is full of “Duvidadores”, Inconsistent and Lack of Coherences in their policies making.
Antagonism – Lots of studies and reports
Mr Alkatiri indicated that Fretilin needs more information/studies. It is not clear what type of information is required to satisfy Fretilin to make a firm and unshakeable position on the questions of bringing the pipeline to Timor-Leste. All information through many years of studies is there at the Government and new Petroleum team’s possession. In case, further briefing and information provision is needed to enable it to make its policy decisions, a simple call to the new Minister and his petroleum team and advisor may solve the problem. Even the previous Petroleum team (myself included), if invited, can present this information to any audience.
It appears now that the issue is not on providing the information. The real issue here is whether or not Fretilin (particularly Mr Alkatiri and perhaps some others) would want to listen and be open-minded to receive such information. One can feed thousands of documents and presented as many times as there can be, but if the receptor does not want to, all those effort will be useless. In my view, this is what’s happening at the moment. Some segments of decision makers in Fretilin are simply too antagonistic of the previous petroleum sector management team under the leadership of Mr Xanana, that they could not but to reject any information or policies or plans that existed. The total “clearance” of previous petroleum team and a repeated denial of the existence of the technical and commercial studies when they are constantly reminded that these reports existed is a clear manifestation of this antagonism.
It is pity that after so many years of resistance and “fights” for the sovereignty of our resources, we still at the point where internally not all political parties are aligned on the importance of the bringing the pipeline to Timor-Leste to boost our socio-economic development of the country and economic independence! Perhaps out of really difference in political convictions but maybe also out of political egoism. All data and information are available at hand, all that is needed now is a political will, a firm, strong, visionary and strategic leadership to use those information and negotiate with our adversaries to secure this very important national interest agenda – bringing the Greater Sunrise pipeline and building the LNG plant in the south coast of Timor-Leste.
Observation and clarification of some confusing statements
Mr Alkatiri mentioned in the interview that “according to the boundary [treaty?] 100% of Greater Sunrise is ours, but we gave 30% to Australia if the pipeline is to Timor-Leste …….., whereas in the past we have 90% [ based on the past treaties] but now we have 80% only if it goes to Darwin”. This is a misleading and confusing statement. The past treaties never gave 90% of Greater Sunrise to Timor-Leste. In fact with Timor Sea Treaty 2003 and IUA only 18.09% of the Greater Sunrise was attributed to Timor-Leste and 81.91% to Australia. This split was improved after strong push from Civil Society demonstrations in Dili and Australia (including President Xanana’s resistance to a quick deal from 2003-2006). Fretilin led negotiation ended with a deal that gave to Timor-Leste only 50% of the revenue from Greater Sunirise at the expense of 50 years moratorium of Maritime Boundary delimitation through CMATS treaty. This is the reality. So, the correct statement is that the past treaties were able to give up to 50% of UPSTREAM REVENUE from development of Greater Sunrise, but without permanent maritime boundary! Whereas the current Maritime Boundary Treaty ratified in August 2019 (where Fretilin vetoed) gives 70% of the UPSTREAM REVENUE sharing to Timor-Leste when pipeline comes to Timor-Leste, with a Permanent Maritime Boundary! These are the facts!
The question that is frequently asked by some segments in Fretilin is why then, 30% UPSTREAM REVENUE is attributed to Australia? Well the simple answer is that because not all Greater Sunrise gasfield fall within Timor-Leste’s jurisdiction. Approximately 30% of the Greater Sunrise field (see Maritime Boundary maps available online) fall within Australia “jurisdiction/sovereignty”, and hence Australia has the right to collect 30% of the revenue! Other reasons include the fact that we have had past treaties (TIMOR SEA TREATY, IUA, and CMATS) that “gave” some sense of “ownership” of the field to Australia in a big way (81.91%, and 50% revenue) and hence Australia insisted some” ownership” of this field (now ~ 30%). It is also important to remember that the Maritime Boundary Treaty was a negotiated outcome treaty, and not a treaty decided by a court (Australia pulled out from the ICJ and ITLOS on Maritime Boundary matters), therefore, the treaty outcome must to take into consideration many aspects of the interests of the parties involved.
Mr Alkatiri also criticised the previous petroleum team and accusing of “….not contributing any cent [to the State] but just expenses…”. These comments must be put to an end! Because it only shows the lack of appreciation to a process in any kind of a nation, and business development. The fact that one starts, does not and should not always means that he/she should be attributed all the good that the nation and the business can entails in the future. It is recognized that, despite some wrong decisions (such as pipeline to Darwin), Fretilin signed the Timor Sea Treaty and the Production Sharing Contracts for the development of Bayu Undan, which subsequently bring revenues to the Government and the nation. Perhaps this is one that Mr Alkatiri and his groups have been proud of. Well, this is noted and acknowledged, and is recognized. However, the process was not ended in just the signature the agreements and development of the field; process must be guarded in the subsequent years through prudent management of the sector to ensure that the project remain robustly operated, maintained, and revenues are correctly paid to the Government(s). These latter processes were done during during CNRT led Governments. So, if the revenues that flow from Bayu-Undan are one to be considered success (contribution to State), in my view, it should not be only credited to Fretilin, but also to the subsequent Governments that were able to manage and improve some of the provisions of those agreement and supervise well the execution of the activities. The previous Petroleum leadership team were an integral part of the whole management of the sector (Government, Ministries, Joint Commission and Sunrise Commission, the Regulator) and bring along more than US$ 27 Billion (around US$ 17 billion Fund balance, and approximately US$ 10 billion already spent on national development) since 2007 to 2020 before they left the office. As a comparison Fretilin Government was able to bring to Petroleum Fund only around US$ 1.5 billion before they leave the office in mid-2007. So, who brings more revenue to the nation in this case?
Francisco Monteiro - Ex- President of TIMOR GAP.
