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The gas fields can be seen between East Timor and Australia
(Map courtesy GeoscienceAustralia via Asia Times, October 2020)
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Australia has already had a mixed history with Timor Leste aka East Timor (ET) a new island nation ruled by politicians of various old guard leftwing factions. After Australia was the major force that liberated ET from the Indonesians in 1999, ET became independent in 2002.
As ET’s capital and harbour Dili is only 722 km from Darwin (map above) it is not a case of if, but when, China debt traps ET. This is of high economic and strategic interest to Australia. 722 km is much closer to Australia than the 2,000 km distance of the Solomon Islands to Australia.
Australia and ET have long haggled over the undersea oil and gas fields that lie between them.
Along comes a headline today Timor-Leste warns it will work with China if Australia insists on pumping Timor Sea gas to Darwin.
This may pan out that impoverished ET might receive enough Chinese infrastructure loans to debt trap ET. The major loan might be for a gas pipeline from the gas fields south of ET to a factory China would build in ET. Given very few East Timorese are engineers or technicians it will be China laying the pipeline, building and running the factory and probably reaping more gas revenue than ET.
Australian and other Western oil-gas companies have considered the ET gas pipeline-factory project overly risky on sheer commercial grounds. One issue concerning them is if they build a factory in ET, then ET’s predictably leftwing governments might nationalise it.
But China has advantages to avoid nationalisation. It might directly bribing ET leaders before, during and after the project. The Chinese military will cross-subsidize such a venture for naval basing rights to Port of Dili and Chinese airforce access to ET's Baucau Airport. ET is too poor and only has small military-police forces, making it unable to hold China back.
East Timor with its oil-gas resources and closer proximity to the US-Australian Army base at Darwin and air base at Katherine would be quite a prize economically and strategically for China. Also a Chinese dominated East Timor is well sited in the southern Indonesian archipelago - to create problems for Indonesia.