FRENTE REVOLUCIONÁRIA DO TIMOR-LESTE INDEPENDENTE
FRETILIN
MEDIA RELEASE
Dili, 20 April 2009
FRETILIN petitions Constitutional Court over
National Petroleum Authority
FRETILIN MPs have asked Timor-Leste’s Constitutional Court to rule that the
National Petroleum Authority created by the Gusmao government in June 2008 is
unconstitutional and breaches the Petroleum Fund Law.
All 15 of the party’s MPs lodged a petition with the Court of Appeal – exercising the
jurisdiction of the Constitutional Court – last Friday, April 17, seeking a ruling that
the Gusmao government did not have the constitutional power to create by decree,
laws, penalties and sanctions governing petroleum exploration without parliamentary
approval.
The petition also asks the court to find that, in providing that the National Petroleum
Authority could charge and directly receive fees from oil companies operating in the
Timor Sea, the Gusmao government breached the Petroleum Fund Law approved by
parliament in 2005. The Petroleum Fund Law provides that all payments by oil
companies to the state of Timor-Leste must be made directly into the Petroleum Fund.
FRETILIN’s parliamentary leader, Aniceto Guterres said in Dili today the Council of
Ministers established the National Petroleum Authority by decree in June 2008,
despite warnings from FRETILIN and non-government organisations that only
parliament had the constitutional power to legislate on petroleum exploration.
“FRETILIN and many other organisations pointed out last year that the new
petroleum law was drawn up in haste and secrecy, avoiding proper parliamentary and
public scrutiny, and opened the door to corruption and mismanagement of the
country's gas and oil revenues.
“Our concerns have only grown with the government’s secret deals regarding the
Sunrise pipeline and LNG plant studies.”
Guterres quoted the leading Timor Leste NGO with greatest experience in the
petroleum sector, La’o Hamutuk, as warning the government on 10 June 2008: “This
law should be passed by Parliament, not the Council of Ministers. This should be a
Law enacted by Parliament, not a Decree-Law approved by the Council of Ministers.”
La’o Hamutuk added: “Transparency is almost entirely lacking, and this law should
be changed or augmented to ensure that important information is available to the
public and that the public has meaningful input on decisions which affect them.”
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Guterres said FRETILIN’s legal advisors had been preparing the petition since last
year.
“It follows our successful petition against the 2008 Mid Year Budget which declared
the Economic Stabilisation Fund unconstitutional and ruled illegal an attempt by
Gusmao to withdraw hundreds of millions of US dollars in excess of the sustainable
income allowed under the law,” Guterres said.
“Under the Gusmao administration, Timor Leste’s petroleum sector has suffered from
a lack of transparency and probity with dubious deals done in secret without
parliamentary scrutiny. As a responsible de facto opposition we are holding the
government politically, legally and constitutionally accountable.
“We call on the government to respect the independence of the courts and the
principle of the rule of law and accept whatever the court decides. FRETILIN will
accept and abide by the court decision, whichever way it goes.”
Guterres said there was still time for the government and parliament to act before the
court decision to avoid a potential institutional crisis in the petroleum sector, should
the court rule against the constitutionality of the National Petroleum Authority.
For further information call Jose Teixeira on +670 728 7080
(See FRETILIN Media Release of 23 June 2008 below for background information)
FRENTE REVOLUCIONÁRIA DO TIMOR-LESTE INDEPENDENTE
FRETILIN
Media Release
23 June 2008
Timor-Leste petroleum law opens door to
corruption
Timor-Leste's new petroleum law has been drawn up in secrecy and haste and opens
the door to corruption and mismanagement of the country's gas and oil revenues,
FRETILIN said today.
“Greater public consultation and parliamentary scrutiny of this law is critically
important to the future of our nation,” said FRETILIN MP and former Minister for
Natural Resources, Minerals and Energy Policy, Jose Teixeira.
Xanana Gusmão’s Parliamentary Majority Alliance de facto government (known by
its Portuguese acronym AMP) enacted its National Petroleum Authority Decree Law
on June 18.
The National Petroleum Authority (NPA) will replace the Timor Sea Designated
Authority (TSDA) for the Joint Petroleum Development Area shared between Timor
Leste and Australia. The NPA will also be responsible for regulating all petroleum
exploration, production, processing and sales activities offshore and onshore in
Timor-Leste.
'This law should not have been passed by decree of the Council of Ministers meeting
in secret but should have been sent to parliament for scrutiny and approval,' Teixeira
said.
“Also, the public was only given five working days to comment on the draft law,
making a mockery of public consultation,” he said.
He said the draft law violates basic principles of the constitution and existing
petroleum law and weakens parliamentary control over the petroleum sector and
petroleum fund spending.
“Whenever the former FRETILIN government enacted any laws in the petroleum
sector, we held wide public consultation and took time to receive and examine all
public input. To us it was critically important for all stakeholders, especially our
people and civil society, to understand fully and give their views on the laws we
proposed to enact.'
Timor-Leste’s petroleum fund created by the former FRETILIN government now
totals almost US$3 billion in savings, and was rated the third most transparent
sovereign wealth fund by the Peterson Institute for International Economics, second
only to those of Norway and New Zealand.
“Petroleum is vital to the future of our nation. It has also has caused untold problems
of corruption and environmental damage, and led to social and political conflict, in
many countries,” Teixeira said.
“Meaningful public consultation that allows all stakeholders to contribute to enacting
good law and reach consensus is the only way to avoid such conflict arising in Timor
Leste.
“It is clear that many national and international stakeholders are disappointed and
concerned with the secrecy and unnecessary haste with which this draft law has been
managed.
“Parliament’s own Natural Resources, Agriculture and Environment Committee did
not even see a draft of the law. For the past six months, FRETILIN members have
been asking the de facto Minister responsible for Natural Resources and/or his
Secretary of State to appear before the Committee to outline developments in the
petroleum sector, without any response.
“The de facto government’s own press statements mention agreements with foreign
oil companies to provide technical assistance to draft laws regarding the national
optimisation objectives for Timor Leste’s downstream petroleum sector.
“However, these agreements are shrouded in unnecessary secrecy, arousing suspicion
amongst civil society and other stakeholders in the petroleum sector.”
On 10 April 2008 President Jose Ramos Horta called on the Gusmão de facto
government to work with FRETILIN to gain national consensus on management of
petroleum resources and revenues.
In a media release on 13 June 2008 La´o Hamutuk, a leading civil society group
intimately involved with the development of the petroleum sector in Timor-Leste
from its inception, was highly critical of the de facto AMP government's secret
handling of the NPA law.
In its submission to the de facto government
Hamutuk said: “One of the 2002-2007 Government's proudest achievements was
transcending party differences to achieve a unanimous parliamentary vote for the
Petroleum Fund Act. This consensus model should be emulated, not circumvented.
Involvement of elected representatives from both the governing parties, and the
opposition is essential to provide stability for the future.”
Jose Teixeira said: “In 2006, the then FRETILIN government received wide national
and international acclaim for the unprecedented highly transparent manner in which
Timor-Leste's inaugural offshore exploration licensing round was managed. The Bid
Tender Independent Evaluation Commission’s report was published and the minister's
decision to award the successful bidders their areas and the full reasons were
published. Then the production sharing contracts were published.
“Only the highest levels of transparency can ensure a corruption-free environment.
“Our highly transparent approach has been replaced by one of secrecy and obscurity.
Vital questions are now being frequently and widely asked about conflict of interest
and potential for collusion and unfair advantage.”
For more information contact: Jose Teixeira +670 728 7080 (Dili, Timor-Leste)
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