Indonesian ministers summoned over border dispute with Malaysia

The Indonesian House of Representatives has said that it will summon key officials from the government of Susilo Bambang Yudhoyono to explain what progress is being made on a border dispute with Malaysia, amid angry protests.

The two states are at loggerheads over both their land and sea borders. Indonesian lawmakers have claimed that the Malaysian government has stepped up naval patrols on the border and sought to effectively annex nearly a kilometre of sea.

Their main area of dispute at sea is the Ambalat zone of the continental shelf between them, which is believed to contain huge undersea energy resources. Malaysia claimed the area in a map which it issued in 1979, but Indonesia rejects the claim. The dispute has not stopped each side from granting oil and gas contracts in the area, but tensions periodically spike, often including confrontations between the two navies.

The land border is the main subject of contention at present. In early October, Indonesia accused Malaysia of damaging several border markers in the West Kalimantan region, leaving parts of the border unclear.

Although the two sides have agreed to send a joint surveying team to the area and settle it as a technical issue, some Indonesian media outlets and officials responded by whipping up nationalist sentiments and declaring that over 1000 hectares of land had been taken by Malaysia.

On 13th October an angry crowd, organised by a group calling itself Forum Betawi Rempug gathered outside the Malaysian embassy in Jakarta and hurled missiles at the building, damaging a security post and forcing police to use tear gas.

The strong feelings on both sides will give added impetus to a plan by the two governments to set up Local Border Committees at each boundary crossing point. The idea was proposed by the head of the Malaysian customs department Datuk Seri Mohamed Khalid Yusuf at a bilateral cooperation meeting between the two sides.

Notwithstanding the willingness of some politicians to score political points from the dispute, the issue looks to be settled at a technical level; neither side has an interest in aggravating tensions.

Sources: Jakarta Post, Borneo Post

Malaysia and Brunei resolve oil block row

Malaysian PM Najib with Bruneian Sultan Hassanal

Malaysia and Brunei signed a deal on 13th December to jointly develop two oil areas off Borneo, ending a border dispute dating from 2003 which had held up exploration.

The agreement will see the national oil firms of Malaysia and Brunei take part in exploration and production in the potentially oil-and-gas rich blocks, Malaysian state news agency Bernama said.

In the ceremony on Monday, Petronas and Petroleum BRUNEI signed a production sharing agreement (PSA) for Block CA2, with a lifespan of 40 years.

The signing ceremony in Brunei was witnessed by Brunei's Sultan Hassanal Bolkiah and Malaysian Prime Minister Najib Razak.

Brunei, a small monarchy surrounded by Malaysia's eastern states of Sarawak and Sabah, awarded exploration rights in one offshore block to French oil firm Total and another to Shell.

But Malaysia's state-owned Petronas awarded the same sites to US firm Murphy Oil and its own subsidiary, Petronas Carigali.

In a bid to end the spat, the two countries agreed in March last year that the disputed areas "are no longer part of Malaysia" but allowed Petronas to enter into new production sharing contracts.

In September 2010, the two countries agreed to jointly develop Block CA1.

After the signing ceremony on Monday, Najib said the percentage sharing agreement was still being discussed. He also said that he hoped joint demarcation and survey of the land boundary between the neighbours could be carried out next year.

Sources: Rigzone, Bernama, NNN

For more information on the Malaysia-Brunei offshore oil dispute, see menas borders.

Border Focus: Indonesia and Malaysia

What is disputed?

Indonesian and Mayalsia have several border disputes, but the most important relates to an area called the Ambalat region in the Sulawesi sea.

Why is the area disputed?

The area is believed to be rich in hydrocarbons, and both countries have offered exploration blocks to IOCs. The area is also rich in sealife and has great tourism potential. The maritime boundary was not delimited during the colonial period.

What is the history of the dispute?

The roots of the dispute lie in a 1979 map issued by Malaysia, which outlined its territorial waters and continental shelf. The map drew Malaysia's maritime boundary running in a southeast direction in the Sulawsi sea, from the easternmost point of the land border on Sebatik Island, an island off the eastern coast of Borneo. The map included large parts of the Ambalat region inside its territory, and Indonesia and other surrounding countries quickly protested to the map.

What is considered to be each country's 'basepoints' is crucial in determining the limits of their maritime claim. In the 1979 map, Malaysia took the islands of Sipadan and Ligitan to be its basepoints, despite the fact that Indonesia had claimed them since 1959. The two countries took the dispute to the International Court of Justice (ICJ), which ruled in Malaysia's favour in 2002, based on its 'effective occupancy' (effectivités).

While the ICJ decision had no bearing on the Ambalat block itself, Indonesia was forced to amend its baselines, removing Sipadan and Ligatan islands as basepoints. In 2008, Indonesia redrew its baselines and as a result, the Ambalat Block was no longer entirely inside Indonesian internal waters.

 

How serious is the dispute?

The dispute over the Ambalat block has continued throughout this decade, with both sides awarding the blocks to oil companies. There are two blocks that are the major disagreement point: what Indonesia calls Ambalat Block and East Ambalat Block, and what Malaysia calls Block ND6 and ND7. The blocks are not identical, but they have large overlapping areas.

The deep sea blocks are estimated to contain at least 62 million barrels of oil and 348 cubic meters of natural gas. In 1999 Indonesia awarded Ambalat Block to ENI, and in 2004 it awarded Unocal the East Ambalat Block. In 2005, however, Malaysia's Petronas awarded Production Sharing Contracts to Shell and Petronas Carigali for both blocks.

There have also been skirmishes between navies, and on numerous occasions one side's fishing vessels have been arrested by patrol boats and accused of being in the other's territory. Both countries have a heavy naval presence in the area.

What are the possible solutions?

Malaysia said in 2009 that it would not refer the dispute to the ICJ, preferring diplomatic channels, which is positive. 2010 has seen both countries commit themselves to negotiations, and it seems that discussions will go ahead despite the fact that Malaysia is currently in dispute with Singapore over claims to Batu Puteh Island. The case has been referred to the ICJ, and while Malaysia previously said it could not resolve its dispute with Indonesia until it had resolved its dispute with Singapore, it looks like this issue has been circumvented.

In August 2010, Indonesia said it was looking into the possibility of temporarily turning the disputed border areas with Malaysia into a jointly managed territory to avoid more border incidents. The two countries have already established joint patrols in the Malacca Strait. This would be a positive first step, and could lead, ultimately, to the establishment of a joint development area in the Ambalat block. Joint Development Zones have been used successfully in other regions where resources straddle the border. Ultimately, until the maritime boundary is definitively established, both sides will lose out on the economic prosperity the Ambalat Block promises.

Cultural and political tensions continue to hind progress however. In 2009, there was uproar in Indonesia when a Malaysian tourism advert on the Discovery Channel featured a traditional Balinese dance called Pendet. One Indonesian politician even suggested they declare war on Malaysia as a result. Malaysia and Indonesia have a rich shared history – there was even a time when the idea of a pan-Malay region was floated – and it is unfortunate that the colonial experience, which created the two nations, and the demands of modern nationalism, which forces the cultures to delineate themselves so rigidly, has caused so many seemingly avoidable problems.

For the full article, please visit the Menas Borders website, here