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Resource disputes on the high seas

Image credit: NASA Earth Observatory (Creative Commons: Wikimedia Commons)

Much of the world’s fossil fuel supply has been depleted, however large deposits still remain under the ocean, where organic matter from millennia gone by has been transformed under immense pressure into oil and natural gas.

These offshore resources represent a modern Wild West in many ways. The enforcement of maritime borders, demarcating a country’s exclusive economic zone (EEZ) from international waters, is a murky area of policy. Convention laid out in 1982’s United Nations Convention on the Law of the Sea dictates that a maritime border typically sits 200 nautical miles from the coast, however, the presence of undersea resources leads many countries to bend this interpretation. Complex caveats exist around geological features such as continental shelves.

Given the lack of major precedents and the inherent difficulties of enforcing maritime boundaries compared to land boundaries (there are very few permanent structures at sea, for example), the extent to which the Convention on the Law of the Sea constitutes customary international law is unknown. This lack of a hard governing law allows geopolitical fracas to place stress on the global rules-based order, which has tentatively existed for the last few decades.

Recently, tensions have bubbled in the Mediterranean as Turkey has announced it will drill for natural gas in waters recognised as the EEZ of Cyprus. Turkey does not recognise Cyprus’ sovereignty in the region, thus claiming its right to drill offshore.

The situation shows no signs of de-escalating, as Turkish Foreign Minister Mevlut Cavusoglu has announced that Turkey is ‘starting drilling in the region’. Federica Mogherini, policy chief of the EU, has hinted that sanctions could be imposed on Turkey if it doesn’t withdraw. The United States has also expressed its displeasure, with a US spokesperson saying ‘this step is highly provocative and risks raising tensions in the region. We urge Turkish authorities to halt these operations and encourage all parties to act with restraint.’

Assertive words are likely to be the strongest action taken against Turkey. With a GDP of $851 Billion USD, Turkey is a much larger economy than its island neighbour (which has a GDP of $22 Billion USD). In areas of international law with little legal guidance, money often talks. It is unlikely that the EU, US or UN will take substantive action against a large regional player without serious legal backup. Given that the Convention on the Law of the Sea lacks such weight behind it, there is little to be done.

The South China Sea is another region in which disputes over offshore resources have caused governments to lock horns. Comprising an area 40 per cent larger than the Mediterranean, it is a significant swathe of ocean. This size may even play a part in minimising the risk of conflict, as the tyranny of distance decreases the likelihood that rival forces will clash.

Nevertheless, below the South China Sea sits an estimated 11 trillion barrels of oil as well as 190 trillion cubic feet of natural gas. China has used its weight to lay claim to a vast area of ocean, much of which overlaps with areas claimed as the EEZs of Brunei, Vietnam, Malaysia, the Phillippines and Taiwan. China has asserted its regional dominance by building artificial islands and airstrips in the area. The Phillippines in 2013 challenged this at the UN’s Permanent Court of Arbitration, which ruled in their favour. Beijing, however, ignored the verdict and continues to claim most of the South China Sea.

Closer to Australia, the Greater Sunrise gas bed sits 240 nautical miles north of Australia and 80 nautical miles south of Timor-Leste (pictured above). Despite sitting more than 200 nautical miles from Australia, the gas bed still sits on the Australian continental shelf, before the Timor Trench. Australia historically leveraged this, claiming the gas bed as its own based on a 1972 treaty with Indonesia.

After Timor-Leste achieved independence in 2002, it might have been inevitable that Australia would have to redraw these boundaries, were it not for the vast economic disparity between the two countries - Timor-Leste’s economy is only 0.2 per cent the size of Australia’s. Timor-Leste did accuse Australia of espionage during subsequent treaty negotiations, seeking conciliation at the UN in 2017. Shockingly, Australia challenged this process by disputing the competence of the tribunal appointed to oversee the conciliation.

This challenge failed, and in 2018 the conciliation was finalised with either a 70/30 or 80/20 revenue split from the proceeds of Greater Sunrise (favouring Timor), depending on which country a gas plant is built in. This would appear to be a happy compromise but Australia has dawdled in ratifying the treaty, siphoning up to $76 Million USD of revenue from existing oil fields that would otherwise have gone to Timor-Leste, leaving the matter open to further dispute.

Before tensions such as these can erupt into conflict, specifically in the South China Sea, it should be a matter of priority for the United Nations Convention on the Law of the Sea to be updated, clarified and solidified into international law. As it stands, large economic players around the world have substantial power over their smaller neighbours. In the interest of maintaining a global rules-based order in uncertain times with increasingly scarce resources, this cannot be acceptable.

Liam Rawson is the Climate and Energy Security Fellow for Young Australians in International Affairs.

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