East Timor Uses China as Bargaining Chip during Energy Negotiations with Australia

East Timor is using China as a bargaining chip in negotiations with Australia’s government over the construction of a gas pipeline from the resource-heavy Timor Sea.

The Southeast Asian nation’s President Jose Ramas-Horta said his country would be happy to enlist China’s help to facilitate the development of the pipeline.

The pipeline project would pump gas from the Greater Sunrise gas fields.

Ramas-Horta says he will bring in China if Australia’s Woodside Energy sticks to its preference to direct gas through the northern Australian city of Darwin.

The Greater Sunrise fields are located approximately 450 kilometers northwest of Darwin and 150 kilometers south of Timor-Leste.

It is estimated to be worth around $70 billion (US$50 billion) and holds around 226 million barrels of gas.

It has been an ongoing point of contention between the Australian and East Timorese governments since 2004.

Ramos-Horta has said his government viewed the pipeline as part of the country’s national strategic goal.

“Timor-Leste would favorably consider a partnership with Chinese investors if other development partners refuse to invest in bringing gas via pipeline to Timor-Leste,” Ramos-Horta told The Guardian.

“Timor-Leste would be on a financial cliff if Greater Sunrise is not operating within the next 10 years.

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“So, very soon, leadership has to make decisions … if necessary, a trip to China.”

In response, Australian Foreign Minister Penny Wong, during a joint press conference in Dili on Thursday with Timor Leste Minister of Foreign Affairs Adaljiza Magno, called for her counterparts to engage in quiet diplomacy and avoid using the media for leverage.

She said that the Australian government recognized that Greater Sunrise was “an extremely important project for Timor-Leste,” and it was “important to recognize, the joint venture partners come to the table and agree on a path forward.

“So, that’s Timor Gap, Woodside, and Osaka Gas,” she said.

“And, as yet, that hasn’t happened.

“I’ve said to the president and to others, we need to unstick it, we need to see how a way through can be found.

“What I would say is that will be best done respectfully and directly—not through the media.”

While Wong did not mention current tensions with Beijing in the region, she did note the tense geopolitical climate.

“One of the ways in which countries—smaller nations and medium-sized nations—one of the ways in which we navigate that period of strategic competition is by working together, by working together to ensure our own economic resilience and that we have a regional order that reflects rules and norms,” she said.

“We don’t want a situation where power and size is the only way in disputes in this world to become resolved.

“We all have an interest in a stable, prosperous order where sovereignty is respected, and where disputes are resolved by norms.”

Wong also observed that Australia’s development assistance and loans come in the spirit of wanting East Timor to be more resilient.

“We know that economic resilience can be affected, can be constrained by unsustainable debt burdens or by lenders who have different objectives.

“We, Australia, we seek to help make your country stronger.

“You may not always like everything we say and do, but that is our motivation.”

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By Nick R. Hamilton

Nick has a broad background in journalism, business, and technology. He covers news on cryptocurrency, traditional assets, and economic markets.

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