38 Cablegram to New York

Canberra, 26 September 1974

O.CH117514 CONFIDENTIAL PRIORITY

Portuguese Timor: Seabed Boundary

Please pass following to Minister as additional background in case the question of the seabed boundary is raised by the Portuguese Foreign Minister.

  1. An interdepartmental meeting was convened by Foreign Affairs on 25 September to consider whether the Australian Government should reply to the Portuguese note of 18 April which conveyed views of the Portuguese Government in reply to our oral protest of 25 March 1974 at Portuguese decision to grant an oil exploration concession in an area claimed by Australia to be within Australian jurisdiction.
  2. Delay in our consideration has been occasioned by need to wait for the political situations in Portugal and Timor to stabilise sufficiently to allow us to make reasonable assessment of Portuguese and Indonesian Government attitudes towards Portuguese Timor.
  3. Meeting agreed that the Australian Government should reply by note to the Portuguese note for following reasons:
    1. From the international legal standpoint it is essential that the assertions in Portuguese Government's note should not remain unchallenged on the written record. In any future negotiations or litigation it would be vital that Portugal's assertions had been met with a clear statement that under international law the area in question forms part of Australia's Continental Shelf and has been declared to be such since 1953.
    2. Such a note setting out Australian position would help to give needed confidence to Australian mining companies with interests in or near the disputed area to commence or continue drilling.
  4. Meeting considered arguments for and against seeking negotiations for an early agreement with Portugal on a sea-bed boundary. The principal arguments against seeking early agreement are that (A) if we open negotiations with Portugal at this stage, we might appear to be favouring the option of continued association of Portuguese Timor with Portugal rather than other possible alternatives; and (B) if Portuguese Timor achieved independence and believed such a prior agreement was not in its interests, there might be strong criticism of Australia for making an agreement with Portugal over Timor's head to deprive Timor of what may be its only major asset--oil. If Australia thus became a focus of antagonism, we would almost certainly lose much of our capability to influence or assist newly independent government. On the other hand, if a boundary line negotiated now gained wide acceptance this would in turn allow petroleum exploration to proceed with more confidence than at present. Moreover, a newly independent government in Timor might not wish to upset relations with Australia by seeking to renegotiate an established boundary line albeit one negotiated by its former colonial rulers. (However, it could be unwise to rest too heavily on this assumption.) In the event of Timor's becoming associated with or part of Indonesia the Indonesians might well take the view that the Australia/Portuguese Timor boundary line should be no less advantageous to them than the existing Australia/Indonesia boundary line. A boundary line which the Indonesians felt to be too markedly in Australia's interest could sour Australian/Indonesian relations. On the other hand, a boundary line relevant to Portuguese Timor markedly in Indonesia's favour could encourage Indonesia to reopen the question of the boundary line elsewhere.
  5. Meeting concluded that in light of the Government's established policy towards Portuguese Timor the Australian note should not propose talks at this time with the Portuguese on delimitation of a seabed boundary but should merely join issue with them on the legality of their claims and set out the basis of Australia's claim. In reaching this conclusion the meeting had in mind also recent reports from Lisbon which suggest that the Portuguese themselves do not wish at present to enter into delimitation negotiations with Australia.
  6. We would wish to review the situation early next year well ahead of Geneva Law of the Sea Conference, subject of course to any developments in the meantime in Lisbon and Portuguese Timor.

[NAA: A10463, 80111311111, iii]