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  1. 1. Keynote Address José Teixeira Vice Minister, Natural Resources, Minerals and Energy Policy República Democrática de Timor-Leste
  2. 2. Content • Timor-Leste the Country • Brief History of Timor-Leste • Economic record • Background to the Timor Sea Treaty • Background on the Timor Sea Designated Authority • Timor-Leste’s Petroleum Sector • Current Management for Timor-Leste’s Petroleum Sector
  3. 3. Timor Leste
  4. 4. South-East Asia
  5. 5. Indonesia Timor Leste Arafura Sea Australia
  6. 6. Timor-Leste the Country • The Democratic Republic of Timor-Leste is made up of – the eastern part of the island of Timor – Oecussi (enclave) – and Atauro and Jaco Islands
  7. 7. Atauro • Dili - Capital Oecussi Timor-Leste West Timor
  8. 8. Timor-Leste the Country • Capital City - Dili • Democratically elected constitutional government • Governing party (FRETILIN) elected in 2002 - 5-year term • Parliamentary system - uni-cameral • Population - 924,000 people • Official languages - Portuguese & Tetum • Major commodities – petroleum & coffee
  9. 9. Brief History of Timor-Leste • 1515 to 1975 Portuguese colony • 28 Nov 1975 declared independent • 7 Dec 1975 to 1999 Indonesian occupation • 30 Aug 1999 UN monitored referendum East Timor votes unanimously for independence from Indonesia • October 1999 - May 2002 United Nations Transitional Administration in East Timor (UNTAET) responsible for the administration of East Timor • 20 May 2002 East Timor celebrates the restoration of independence and becomes the world’s newest nation East Timor officially becomes known as the Democratic Republic of Timor-Leste (“RDTL”)
  10. 10. Economic performance • Embryonic economy based on open and market-based principles, good record of management • Inflation at 2 per cent; economic growth in 2005-06 at 6 per cent • Budget surplus of 21 per cent of GDP in 2004-05; forecast to average 10 per cent over next four fiscal years • Petroleum Fund established to receive all petroleum revenues. A highly transparent, fully accountable model based on principle of spending only sustainable revenue
  11. 11. Timor Sea Treaty - Background • 1991 to 2000 Timor Gap Treaty between Australia and Indonesia for the Zone of Cooperation (ZOC) • 10 Feb 2000 Exchange of Notes between Australia and UNTAET – UNTAET (on behalf of East Timor) assumed role of Indonesia in the Timor Gap Joint Authority (regulator of the ZOC A) – East Timor begins to have an active role in the management of petroleum in the ZOC A • May 2002 – Timor-Leste and Australia sign the Timor Sea Treaty (TST) which establishes the Joint Petroleum Development Area (JPDA) and splits revenue from petroleum produced 90:10 respectively
  12. 12. Timor Sea Designated Authority • April 2003 – Timor Sea Treaty enters into force and Timor Sea Designated Authority (“TSDA”) is established • Role of the TSDA – to regulate and monitor petroleum activities in the JPDA and – to collect revenue from petroleum produced in the JPDA on behalf of Timor-Leste and Australia • A partner in Production Sharing Contracts • An international organisation • TSDA has offices in Dili, Timor-Leste and Darwin, Australia • 2006 - TSDA will become part of the Ministry or a statutory authority in Timor-Leste
  13. 13. Current Management for Timor-Leste’s Petroleum Sector Prime Minister Timor Sea Minister for Natural Resources, Minerals and Energy Policy Treaty Ministry for Ministry of Timor Sea Ministerial Natural Resources, Minerals Planning & Finance Office (TSO) Council and Energy Policy Vice Minister Timor-Leste Natural Resources, Minerals Revenue Service Joint Commission and Energy Policy (TLRS) Timor Sea Oil, Gas and Energy Timor Sea Designated Authority Directorate (OGED) Tax Division (TSDA) GOVERNMENT OF TIMOR-LESTE TSDA PETROLEUM SECTOR
  14. 14. The Petroleum Sector • Bayu-Undan first oil in February 2004 - most significant component of GDP • Critical building block for future economic independence – Expectations for sector more than simple “rent collection” – Petroleum Law, Model PSC, Petroleum Tax Regime – Petroleum Fund
  15. 15. 2005/2006 Offshore Acreage Release • This bidding round perhaps like no other – world’s newest nation offering rights in what is probably Asia’s last hydrocarbon frontier • Follows first-ever area-wide seismic survey in exclusive maritime area • In parallel, releasing acreage covering half of JPDA • Bidding process will be highly transparent and accountable process in line with good governance principles practised by RDTL and TSDA
  16. 16. Location Map te r- Les Timo Australia
  17. 17. Concluding remarks • Timor-Leste is Open for Business • Today is an early but important step in launching a process that will allow us to develop our petroleum sector to its fullest potential, together with you • Our pledge we will reward your interest in Timor-Leste with openness, fairness, objectivity and professionalism • And… we hope… with exploration success