FINANCIAL TIMES: Malaysia seeks end to dispute on oil with Indonesia: “Malaysia said yesterday it would seek talks to end a dispute with Indonesia over potentially oil-rich waters off Borneo after Jakarta took the unusual step of sending warships to the area.”: “Malaysia and Indonesia claim sovereignty over the waters in the Sulawesi Sea. The dispute has been stoked by a decision last month by Petronas, the Malaysian state oil group, to award exploration rights to Shell, the Anglo-Dutch oil group.” (ShellNews.net) 4 March 05
By John Burton in Singapore
Published: March 4 2005
Malaysia said yesterday it would seek talks to end a dispute with Indonesia over potentially oil-rich waters off Borneo after Jakarta took the unusual step of sending warships to the area.
"There's nothing to stop us from sitting down and talking to solve any problems," said Syed Hamid Albar, the Malaysian foreign minister, who ruled out sending naval vessels in response to Indonesia's action.
The sudden escalation of tensions came after Indonesia's president, Susilo Bambang Yudhoyono, made a fence-mending visit to Malaysia last month. Bilateral ties have recently been strained by Malaysia's decision to expel up to 1m illegal foreign workers, most of them Indonesian.
Malaysia and Indonesia claim sovereignty over the waters in the Sulawesi Sea. The dispute has been stoked by a decision last month by Petronas, the Malaysian state oil group, to award exploration rights to Shell, the Anglo-Dutch oil group.
Some of the concession granted by Petronas overlaps with one that Indonesia granted to Unocal, the US oil group, last year.
Indonesia's strong response, which includes the dispatch of four warships, is seen as appeasing public unhappiness over Malaysia's crackdown on illegal Indonesian workers.
But analysts believe Malaysia and Indonesia, the two largest Muslim countries in south-east Asia, will not allow the dispute to get out of hand, particularly when their two navies are co-operating in conducting patrols to prevent piracy in the Malacca Strait, the main sea route for energy supplies to east Asia.
Indonesia and Malaysia previously disputed the ownership of two small islands in the Sulawesi Sea, which were awarded to Malaysia in 2002 by the International Court of Justice.
Jakarta has warned that it would not tolerate a similar loss of territory in the future.
Indonesia also has claimed that Malaysian loggers have intruded into its part of Borneo, which is divided between the two countries and was the scene of an armed conflict in the early 1960s.
Mr Syed Hamid yesterday said bilateral ties were "close and good".
There are suggestions that both countries might agree eventually to develop resources jointly in the disputed area.