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East Timor seeks ‘unpaid taxes’ from foreign oil

July 11, 2012

DILI: East Timor is seeking “possibly billions” of dollars from foreign oil companies, including US-owned ConocoPhillips, in unpaid taxes, the government said in a statement received Wednesday.

The government has begun an auditing process, hoping “to recover substantial monies it believes are rightfully owed… under legal obligations”, the statement said.

The companies under audit operate in the Joint Petroleum Development Area in the Timor Sea, whose resources are 90 percent owned by East Timor and 10 percent owned by neighbouring Australia.

The statement did not explain the timeframe or how many companies would be audited, but it said the government had so far made 28 assessments against several companies.

The only named company, ConocoPhillips, could not be immediately contacted.

“It is a David and Goliath fight,” said Secretary of State for Natural Resources Alfredo Pires, adding that “hundreds of millions, possibly billions” is owed.

The cause is backed by lawyer Pierre-Richard Prosper, a former US-Ambassador-at-large for war crimes, who will represent the state.

Prosper said that during the auditing process, authorities “are discovering that there are large areas where there were discrepancies”.

East Timor is one of the world’s youngest nations, winning formal independence just a decade ago.

It is one of Asia’s poorest countries and its economy relies heavily on energy reserves, which make up 90 percent of its GDP.

The International Monetary Fund has described East Timor as the world’s most oil-dependent nation.

-AFP


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