review of transboundary environmental impact assessment: a case study from the timor gap

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Review of transboundary environmental impactassessment: a case study from the Timor GapDadang Purnama PhD aa Indonesian State Ministry for the Environment, Department of Geographical andEnvironmental Studies , The University of Adelaide , Adelaide , South Australia , 5005 ,Australia Phone: +61 08 8303 5645 Fax: +61 08 8303 5645 E-mail:Published online: 20 Feb 2012.

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Impact Assessment and Project Appraisal, volume 22, number 1, March 2004, pages 17–35, Beech Tree Publishing, 10 Watford Close, Guildford, Surrey GU1 2EP, UK

Transboundary EIA

Review of transboundary environmental impact assessment: a case study from the Timor Gap

Dadang Purnama

The Treaty of Timor Gap provides for a specific procedure of transboundary environmental im-pact assessment (EIA). However, the lack of con-sistency and coordination in implementing EIA, has reduced its effectiveness. Comparative studies of four EIA systems (including the Espoo conven-tion) indicate their strengths and weaknesses in comparison with the Timor Gap process. Al-though there were clear procedures for EIA in In-donesia and Australia, incorporation of both systems into a transboundary EIA was not simple. Particular stages of the Timor Gap EIA system were inadequately implemented and the system needs to be improved. Lessons from the Timor Gap EIA will add knowledge about implementing transboundary EIA and are important for the fu-ture formulation of environmental regulations in the newly independent East Timor.

Keywords: Indonesia; Australia; East Timor; Espoo Convention; transboundary EIA

Dadang Purnama works for the Indonesian State Ministry for the Environment and is completing his PhD in the Department of Geographical and Environmental Studies, The University of Adelaide, Adelaide, South Australia 5005, Australia; Tel: +61 08 8303 5645; Fax: +61 08 8303 3772; E-mail: dadang. [email protected].

This paper represents a short version of a master’s disserta-tion in 1999. The research was carried out under a scholarship from the Indonesian Environmental Impact Management Agency, Bapedal. The author wishes to thank Professor Nick Harvey, Adelaide University, for helpful comments. He is also grateful to the two anonymous reviewers for constructive feedback.

TUDIES OF THE EFFECTIVENESS of envi-ronmental impact assessment (EIA) have de-manded new approaches for a better planning

process (for example, Wood, 1995; Sadler et al, 1996; Harvey and McCarthy, 1997). These include strategic environmental assessment (SEA), cumulative impact assessment (CIA) and transboundary EIA. On the other hand, the trend towards globalisation, where national boundaries are no longer distinct and import-ant, as well as environmental impacts on trans-boundary areas, require the development of new international EIA standards. This is supported by the fact that the implementation of EIA for proposals situated on the border of two jurisdictions could be potentially limited by different EIA systems.

Wood (1997) finds that constitutional matters (dif-ferent jurisdictions between federal and state gov-ernments) have contributed to EIA’s failure to cover all significant projects and to ensure proper actions towards certain impacts such as cumulative, indirect, economic, and social. Similarly, these constitutional elements would affect the application of transbound-ary EIA for projects crossing the boundaries of two or more countries with totally different EIA systems.

Efforts are being made to resolve this issue, for example, the Espoo Convention is an international convention on transboundary EIA. Another example of the implementation of transboundary EIA in-volved Australia and the formerly Indonesian juris-diction of East Timor, and applied to an oil-rich area known as the Timor Gap.

An agreement was reached by the Governments of Indonesia and Australia in 1989 to exploit oil and gas in the Timor Gap, where previously the Austra-lian Government recognised Indonesian sovereignty over East Timor. The two countries agreed to conduct

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Transboundary EIA in Timor Gap

18 Impact Assessment and Project Appraisal March 2004

a transboundary EIA process through a bilateral treaty. It was inevitable that each country’s EIA sys-tem affected the formulation of transboundary EIA. The two systems as they were at that time will be discussed later.

After a long conflict and various political pro-cesses, East Timor finally became an independent country and officially declared its sovereignty on 20 May 2002. Recent political processes in the region are leading towards the establishment of good rela-tions between Indonesia, East Timor and Australia. The newly independent country needs an enormous amount of funds to build its economy.

Previously, East Timor was known for its high-quality coffee and sandalwood, which were its major source of cash income and its main export (Budiardjo and Soei Liong, 1984; Dunn, 1983; Turner, 1998; Fischer, 2000; Greenless and Garran, 2002). However, after the massive physical destruc-tion following the 1999 referendum, and the unre-covered agricultural and economic activities, tapping oil resources in the Timor Gap is the only immediate way to restart development. Oil and gas should provide support for economic growth (Fischer, 2000, page 140). Revenue from the Timor Gap will reach several hundred million dollars and will be the foundation of East Timor’s budget (Greenless and Garran, 2002, page 311). Therefore, the new Gov-ernment of East Timor should carefully manage the utilisation of this natural resource.

The new East Timor administration has established about 75 regulations since 1999 (UNTAET, 2002). Many of them still deal with major priorities, such as political order, military forces, civil affairs, and eco-nomics management. In relation to environmental legislation, regulations are still limited. For example, there is only one regulation, number 17 of 2000 per-taining to Prohibition of Logging Operations and Ex-port of Wood, which has a direct relationship with environmental management (UNTAET, 2002).

Certainly, the Government will continue to build its legislative system and it would be useful in the long term if environmental considerations were given careful attention from the very beginning. The critical position of oil resources as a financial source for East

Timor’s development should emphasise the necessity of environmental regulations, since technically and environmentally uncontrolled exploitation of such re-sources could lead to unsustainable development, en-vironmental degradation and economic loss.

In this context, a review of previous experiences in environmental management involving East Timorese jurisdiction is relevant. This paper dis-cusses the complexity of transboundary EIA result-ing from the Timor Gap case, which involved Indonesia and Australia during the 1980s and 1990s. There were clear EIA procedures in Indonesia and Australia to support its best practice during the formulation of the Timor Gap transboundary EIA, but incorporation of two systems into a transbound-ary EIA was not simple.

The paper also puts forward EIA in a transbound-ary context as a basis of comparison with the Espoo Convention. It compares four EIA systems (Indone-sia, Australia, Espoo and Timor Gap) and indicates their strengths and weaknesses in comparison with the Timor Gap transboundary EIA process. To sup-port this paper, a research project was carried out based on interviews, studying the relevant documen-tation and data interpretation. From the discussion, lessons can be learnt to add knowledge about the implementation of transboundary EIA; these will perhaps contribute to the future formulation of envi-ronmental regulations in East Timor. The analysis draws on the personal experience of the author who was involved during the Timor Gap EIA process between 1993 and 1997.

EIA systems

EIA systems are constantly evolving, including in Indonesia and Australia. Currently in Indonesia, EIA is implemented according to the newest regulation incorporated in the Indonesian Government Regula-tion number 27 of 1999 (for more comprehensive discussion on EIA evolution in Indonesia, see Purnama, 2003). Similarly, the Commonwealth of Australia uses a new Act known as the Environment Protection and Biodiversity Conservation Act, which came into force on 16 July 2000 (Environment Aus-tralia, 2001).

In the context of EIA in the Timor Gap, the ap-plied EIA systems at that time were Indonesian Government Regulation number 51 of 1993 and the Environment Protection (Impact of Proposals) Act 1974 (EP(IP) Act 1974) in Australia. To provide the context of the transboundary EIA process at that time, the EIA system in both countries will be briefly outlined since they influenced the trans-boundary system.

EIA in Indonesia during Timor Gap application

EIA or AMDAL (Analisis Mengenai Dampak Ling-kungan) in Indonesia is defined in Article 1(2) of

The critical financial position of oil resources for East Timor’s development emphasises the need for environmental regulations, since uncontrolled exploitation could lead to unsustainable development, environmental degradation and economic loss

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Impact Assessment and Project Appraisal March 2004 19

Indonesian Government Regulation 51/1993 (Bapedal, 1993) as: “the process of studying the sig-nificant impact of a proposed business or activity on the environment, which is required as part of the decision-making process”. The EIA was adminis-tered by the Bapedal (Badan Pengendalian Dampak Lingkungan or Environmental Impact Management Agency, EIMA).

EIA was first introduced to the environmental

management system in Indonesia in 1982 through the provision of Act 4/1982 pertaining to Basic Provision on Environmental Management (later amended by Act 23/1997, Bapedal, 1997). Further EIA regulation was provided in Government Regulation 29 of 1986 and later was changed by Government Regulation 51 of 1993. The EIA process at the period is summarised in Figure 1 (Purnama, 2003).

The screening process and triggering mechanism

Rejected

No EIA required

Investment Board, sectoral department or other government agency

Private sector proponent (with government privileges)

Government proponent

Private sector proponent

Sectoral department or other government agency

EIA required

EIA Terms of Reference (EIA TOR)

Preparation of EIA report and environmental management and

monitoring plan (EMPs)

Rejection of proposed activity

Final decision from President after advice from Environment Minister

Screening process, Prescribed list

EM No. 39/1996 (previously No. 11/1994)

Related EIA commission in

each sectoral department or other agency

Approval by sectoral department or other agency

Permitting and licensing

Standard operation procedures

(SOP or UKL/UPL)

Review 45d

Review 12d

Appeal 14d

Figure 1. Indonesian EIA process under Regulation 51 of 1993Source: Purnama (2003)

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in Indonesia utilised a prescribed list through the Environment Minister Decree (EMD) 39/1996 (pre-viously introduced in EMD KEP-11/MENLH/1994 and sectoral minister decrees). However, the Minis-ter had the call-in power to request an EIA (discre-tionary) if there were uncertain conditions, or for a specific major project that had not yet been defined on the prescribed list. In addition, Indonesia only used one level of assessment. Non-EIA activities were regulated by a separate regulation related to UKL–UPL or SOP (standard operating procedure).

Scoping was undertaken through the preparation of the terms of reference (TOR) for an environmental impact statement (EIS). The scoping process occurred when the EIS TOR were reviewed by all EIA stake-holders for further agreement on the scope of the EIS investigation. Once the TOR were agreed, the propo-nent started to prepare an EIS and environmental management and environmental monitoring plans (EMPs) in accordance with the agreed TOR, general guidelines and sectoral technical guidelines. Follow-ing the completion of the EIS and EMPs, the assess-ment process occurred within 45 working days. The proponent had the right of appeal against a rejection; this must be made within 14 days.

Public opinion was represented by non-government organisation (NGO) delegations, espe-cially during the EIA review process. However, the regulations provided the opportunity to submit written comments. After EIS and EMPs were ap-proved, competent authorities would follow up the implementation of EIS and EMPs through regular monitoring measures. Theoretically, the EMPs could be altered and revised whenever the major environ-mental setting or the actual development changes. The revision of EMPs could also be triggered by a mismatch between predicted results and the actual impacts that occurred.

EIA in Australia during Timor Gap application

EIA in the Commonwealth of Australia commenced on 17 December 1974 and was determined by Act 164 of 1974: Environment Protection (Impact of Proposals) Act 1974 or EP(IP) Act 1974. The Act was administered by Environment Australia on be-half of the Department of the Environment (DOE). It is worth noting that the Commonwealth Government has its own EIA system apart from that in every state and territory. For example, since the location of the case is close to the Northern Territory, it was possi-ble for the Northern Territory EIA system to influ-ence the process in the Timor Gap.

However, since the case was considered to be an international entity, it was deemed appropriate for the Commonwealth EIA system to influence deci-sion-making on the Timor Gap projects. In support-ing the EP(IP) Act 1974, the Administrative Procedures were set out under the Act (Australian EIA Network, 1996b) and afterwards amended in 1987 and 1995 (Harvey, 1998, page 162). According

to the Administrative Procedures, the key purpose of EIA was “to inform decision-makers of the likely impacts of a proposal before a decision is made” (Australian EIA Network, 1996b).

The Commonwealth EIA process during that pe-riod was comprehensively discussed in Harvey (1998). The triggering for EIA requirement rested with the action Minister (not necessarily the Minister for Environment) responsible for the proposed de-velopment. Hence, the screening stage was fully dis-cretionary. The action Minister would designate the proponent, who would supply information related to the proposal and this was commonly referred to as a Notice of Intention (NOI).

After this, the Department of Environment, Sport, and Territories (DEST) would decide on the level of assessment: one without the preparation of an EIS or a public environmental report (PER); one following the preparation and public review of a PER; one fol-lowing the preparation and public review of an EIS; or an examination by a Commission of Inquiry (see Figure 4). The scoping process took place after the assessment level was decided by DEST and Environ-ment Australia prepared specific project guidelines. Public input was included in accordance with the con-sultation process. The process is shown in Figure 2.

After the content of an EIS or a PER was decided, the proponent might proceed to prepare the actual documents. The public participation stage started from the scoping process and continued through to the consultation process. When the draft EIS or PER was ready, public participation became the central activity in the process when the draft should be made available for comment.

The overall process of public participation might have taken at least 28 days for commentary and not more than seven days to report the resulting com-ments by the proponent. A further assessment process took a maximum of 28 days for PER by the Common-wealth Environmental Protection Agency (CEPA) and 42 days for EIS by DEST to be carried out. Fi-nally, the Minister for Environment recommended the result of an EIA to the action Minister within 28 days for PER and within 42 days for EIS before the action Minister proceeded to the final decision.

Another important provision was that of joint and co-operative assessment. Certain activities might need approval from different levels of government, for instance, from the state and at the same time from Commonwealth level. Therefore, to avoid duplication of the EIA process, the Commonwealth made ar-rangements with states and territories. When EIA was required under joint assessment, guidelines would be prepared to ensure that assessment documentation satisfied the requirements of both jurisdictions.

Espoo Convention

An international convention on transboundary EIA was firstly initiated to bind the members of the United Nations Economic Commission for Europe through

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the Espoo Convention, and was signed by 29 countries in 1991 (Sadler et al, 1996). The Conven-tion was signed at Espoo in Finland and thus become known as the Espoo Convention. It makes provisions for those member countries to conduct environmental assessments for specific projects in transboundary areas between or among member countries.

The Convention serves as a legal basis for trans-boundary EIA within member states of the Eco-nomic Commission for Europe, with consideration of Paragraph 8 of the Economic and Social Council resolution 36 (IV) of 28 March 1947. The EIA process in the Convention is critically defined as (UN/ECE, 1996b, Article 1):

Environmentally significant proposal initiated

Action minister designates proponent

Proponent provides notice of intention

DEST determines assessment level

No assessment or DEST recommendations

Commission of inquiryPER EIS

DEST sets guidelines following consultation (this may include public input

PER/EIS prepared by proponent

PER placed on public exhibition for a period of not less than 28 days

DEST may hold round-table discussions with public/proponent

The Environment Minster may require additional information within 21 days of

public review period

CEPA assesses PER and makes recommendations in assessment

report within 28 days (this report is publicly available)

Environment Minister makes recommendation to Action Minister

within 28 days

EIS placed on public exhibition for a period of 28 days or longer

DEST may hold round-table discussions with public/proponent

Proponent responds to submissions in a supplement or revised draft EIS

The Environment Minster may require additional information within 21 days of

public review period

DEST assesses final EIS and makes recommendations in assessment report within 42 days or longer (this report is

publicly available)

Environment Minister makes recommendation to Action Minister

within 28 days

Action Minister has regard to recommendation in final decision

Figure 2. Australian Commonwealth EIA process under EP(IP) Act 1974Source: Harvey (1998, page 167)

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“(viii) ‘Transboundary impact’ means any im-pact, not exclusively of a global nature, within an area under the jurisdiction of a Party caused by a proposed activity the physical origin of which is situated wholly or in part within the area under the jurisdiction of another Party.”

The Convention is supported by guidelines such as: the Bilateral and Multilateral Cooperation on EIA in a Transboundary Context; Specific Methodologies and Criteria to Determine the Significance of Ad-verse Transboundary Impact; and a Final Report of the Task Force on Legal and Administrative Aspects of the Practical Application of Relevant Provisions of the Convention.

The essential point of the Convention is that it takes into consideration all the EIA laws, regula-tions, and practices of its members (UN/ECE, 1996b, page 3):

“Different countries have different EIA proce-dures. Therefore, it might be useful in a bilat-eral or multilateral context, first to compare the

procedural requirements of the Convention with the national procedural steps. Such a com-parison will clarify similarities and diver-gences, and help to identify any future problems or opportunities for concerted action. The next step would then be to try to adapt the national procedures in line with the provisions of the Convention and to agree on the details of the procedure that should be followed when-ever the Convention applies. As a general rule the EIA procedure of the Party of origin applies whenever the Convention applies.”

The Convention sets out major the EIA procedural steps (summarised in Figure 3). The process starts with the screening stage, which is referred to in the Convention as Application of the Convention. Pro-posed activities subject to EIA application are on a prescribed list, which refers to Appendix I of the Convention. Further provisions (in Appendix III) in-corporate the need for Concerned Parties to discuss and include other activities that could have signifi-cant impacts.

SCREENING Prescribed list (Appendix I and III of the Convention)

NOTIFICATION For all Concerned Parties

TRANSMITTAL OF INFORMATION and Public participation

PREPARATION OF EIA DOCUMENTATION (Appendix II)

Other provision for Joint Body for assessment

DISTRIBUTION OF EIA DOCUMENTATION for participation of authorities and affected public

CONSULTATION based on EIA documentation

FINAL DECISION By the Party of Origin

ADDITIONAL INFORMATION After decision but before work of activity for

further consultation

POST PROJECT ANALYSIS (Review process and necessary measures

to overcome transboundary impact)

JOINT PROVISION BODY

INQUIRY PROVISION

Figure 3. EIA in a transboundary context (the Espoo Convention)Source: Interpreted from Convention on EIA in a Transboundary Context (UN/ECE, 1996b)

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Subsequent to the decision of the applicability of the Convention for certain activities, the Party of ori-gin shall notify any Party, which it considers may be an affected Party as early as possible (Article 3.1). There is no timeframe for the notification, but it should

be made no later than when informing its own public about the proposal. The Party of origin shall ensure that affected Parties are notified (Article 2.4). The no-tification stage is continued by confirmation of the af-fected Parties’ participation, as to whether they intend to become involved in the EIA procedure or whether the Party of origin will be allowed to carry out the EIA on the basis of its national law and practice.

The transmittal of information in Article 3.6 is essentially an EIA scoping process, where all the concerned Parties confirm all related information on the potentially affected environment under their ju-risdiction. Information exchanges then proceed to discussions on whether there is likely to be a signifi-cant adverse transboundary impact. This stage also provides for a Joint Body if it exists or is agreed to by concerned Parties. The Joint Body here is similar to the Joint Authority (JA) in the case of the Timor Gap discussed later.

In addition, a provision is made for inquiry if those Parties cannot agree about whether there is likely to be a significant adverse transboundary im-pact in accordance with the provisions of Appendix IV, which defines the inquiry procedure. Provision is made in Article 3.8 for the beginning of a public par-ticipation process, in which concerned Parties shall ensure that the public of the affected Party in the areas likely to be affected be informed of, and be provided with, the chances to make comments or ob-jections on the proposed activity.

Those comments and objections should be trans-mitted directly to the competent authority of the Party of origin. After the preparation of EIA docu-mentation by the proponent in the Party of origin, public participation should continue during the Con-sultation stage (Article 5). However, almost all stages have no time limitation, and this depends on agreement among the Parties. Once the Parties have considered it, decisions are made by the Party of origin and given to the affected Party (Article 6).

In terms of monitoring process, the Convention includes a provision for post-project analysis that ac-counts for significant adverse transboundary impact of an activity. Any post-project analysis undertaken shall include, in particular, the surveillance of the activity and the determination of any adverse trans-boundary impact. The post-project analysis, as stated in Appendix V, covers several objectives as follows:

a. “Monitoring compliance with the conditions as set out in the authorisation or approval of the activity and the effectiveness of mitiga-tion measures;

b. Review of an impact for proper manage-ment and to cope with uncertainties;

c. Verification of past predictions in order to

transfer experience to future activities of the same type.”

Case study: Timor Gap transboundary EIA

The Timor Gap is the area between Indonesia and Australia where East Timor was the 27th province of Indonesia and is located adjacent to the Northern Territory of Australia (see Figure 4). This name be-came well known after lengthy disputes over the area between Indonesia and Australia. One factor in the unresolved boundary disputes was the presence of Portugal, a former colonial power, up to 1975. In-donesia’s claim was based on a shelf 200 nautical miles wide from the outer island, whereas Austra-lia’s claim relied on the sea-based geomorphology (Robson, 1995). Urged by many interests including economic and political considerations, Indonesia and Australia established the Timor Gap Treaty, which was signed in 1989 (see DFAT, 1995).

The focus of the Treaty is an area of about 61,000 square km (Bundy, 1995), which is estimated to have rich oil resources. It was named then the Zone of Co-operation. The Zone was divided into three areas — A, B, and C — where area A (ZOCA, Zone Co-operation of Area A) is the main core of the Treaty for joint development (joint control) while B and C are managed mainly by Australia and Indone-sia respectively.

Indonesia and Australia established an institution called the Joint Authority (JA) for the Timor Gap to control and manage activities relating to exploration for, and exploitation of, petroleum resources in Area A (Treaty Article 8). The JA also had judicial and legal capacities under clauses of Article 7 of the Treaty and was responsible to the Ministerial Coun-cil, which was an institution established by Australia and Indonesia consisting of competent ministers from both countries.

In conjunction with the establishment of the Treaty, further consideration for EIA applications had been set up along with the JA’s task to apply EIA. The Treaty gave full authority to the JA to re-view any EIS prepared by proponents and originating from the EIA process under the Treaty regulations.

Indonesia and Australia established the Joint Authority (JA) for the Timor Gap to control and manage activities relating to exploration for, and exploitation of, petroleum resources in Area A: it consisted of competent ministers from both countries

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The JA was to make recommendations to the Minis-terial Council for approval of a shared production contract. The role of the JA became crucial as it was the only institution that regulated and supervised the EIA process notwithstanding its limited number of personnel (ten people).

Treaty of Timor Gap

“We are all aware of the Australian defence in-terest in the Portuguese Timor situation, but I wonder whether the department has ascertained the interest of the Minister of Department of Minerals and Energy in the Timor situation. It would seem to me that this department might well have an interest in closing the present Gap in the agreed sea border, and this could be much more readily negotiated with Indonesia than with Portugal or independent Portuguese Timor. I know I am recommending a pragmatic rather than a principled stand, but that is what national interest and foreign policy is all about.” (Cable from the Australian Ambassador to Indonesia to the Department of Foreign Af-fairs, 17 August 1975, quoted in Townsend-Gault and Stormont, 1995, page 66)

The Timor Gap Treaty was established on 11 De-cember 1989. It was called the Treaty between Aus-tralia and the Republic of Indonesia on the Zone of Cooperation in an Area between the Indonesian Province of East Timor and Northern Australia. Its

main rationale was to exploit the oil resources in an area between Australia and Indonesia. This is clearly shown in the main consideration at the very begin-ning of the Treaty (DFAT, 1995, page 1):

“DESIRING to enable the exploration for and exploitation of the petroleum resources of the continental shelf of the area between the Indo-nesian Province of East Timor and northern Australia yet to be the subject of permanent continental shelf delimitation between the Con-tracting States; CONSCIOUS of the need to encourage and promote development of the petroleum re-sources of the area; DESIRING that exploration for and exploita-tion of these resources proceed without delay.”

EIA procedures in the Timor Gap Treaty framework

Provision regarding EIA implementation is found in Article 8 (paragraphs a and j) regarding the func-tions of the JA, Annex B Article 11(2) regarding considerations of application, and Annex B Article 37(1) paragraph l regarding regulations and direc-tions. The EIA process was set out in special Administrative Guidelines for Petroleum Operations in the ZOCA (JA, 1997a; BHP Petroleum, 1999a). Guideline No 90/5 pertains to the Guideline for the Preparation of the Environmental Impact Assess-ments of Petroleum Operations (JA, 1997a; BHP Pe-troleum, 1999a). The content of this Guideline

Figure 4. Orientation map of the Timor GapSource: Adapted from International Journal of Coastal Law (in Blake et al,

1995, page 86)

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includes requirements for an environmental manage-ment plan and environmental monitoring program. It also contains requirements for information to be in-cluded in a PER in Attachment A and procedures for comment on a draft EIS in Attachment B. So the Guideline uses two assessment levels, PER and EIS.

The EIA process is summarised in Figure 5. The screening and triggering mechanism is arranged in the Guideline. Since activities in the Timor Gap are solely concerned with oil exploration and exploita-tion, the EIA requirement only applies to three spe-cific activities (JA, 1997c; BHP Petroleum, 1999c):

• construction or installation of a fixed platform (Regulations clause 305);

• construction or installation a pipeline (Regula-tions clause 330);

• drilling (Regulations clause 501).

The scoping is conducted through lists in the Guide-line, where the contents of reports or statements are specified also. The assessment process is conducted by the JA, or by independent experts engaged by the JA (paragraph 9). Furthermore, the JA will also refer the report to relevant Indonesian and Australian au-thorities for comment. The procedures for comment on draft EISs are set out in Attachment B.

In determining if further environmental informa-tion, hence an EIS, is required, the JA will take into account to what extent the petroleum development would cause environmental impact according to cri-teria set out by the Guideline. When the JA decides an EIS is necessary, the contract operator will sub-mit a draft EIS which will be referred by the JA to relevant Indonesian and Australian authorities for comment. Each authority will assess the draft EIS according to its own procedures.

PER

ZOCA Joint Authority

EIS required?

Further work to examine alternatives to

proposed plans

Draft EIS

ZOCA Joint Authority

Joint Authority directs review of draft

EIS if needed

Final EIS

Joint Authority grants environmental

approval

Project Scope incl. Development proposal

Baseline Survey

Joint Authority grants environmental approval

Project implementation

Joint Authority refers PER to MIGAS

Joint Authority refers PER to DPIE

Joint Authority refers EIS to MIGAS

Joint Authority refers EIS to DPIE

Draft EIS advertised for 60 days

DPIE consults CEPA

MIGAS consults BAPEDAL

DPIE consults CEPA

MIGAS consults BAPEDAL

No

Yes

Figure 5. EIA process for development in ZOCA Source: Visual presentation of BHP’s PER for proposed Elang oil field development, November 1995 Administrative Guideline 90/5 for Petroleum Operations in Area A Confirmed by Executive Director of the JA on 13 July 1999 in a personal communication

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After assessment of the EIS, the JA may require the contract operator to alter it, and may direct that changes be made to the environmental management plan before approving an application. Under these circumstances, the JA will give approval for the pe-troleum development to go ahead in accordance with the final EIS.

There are several EIA reports applicable to the Timor Gap EIA system. Until 13 July 1999, the JA had documented 12 PERs and one EIS. The next section of this paper will review one of the most complex and the only EIS report in the Timor Gap EIA system, which is for the Elang (Eagle) Oil De-velopment Project by BHP (The Broken Hill Pro-prietary) Petroleum Pty Ltd. There were critical changes in East Timor in August 1999 that led to the abolishment of the Treaty, and since then no more EISs have been prepared.

Implementation in Elang Development Project

The proponent, triggered by the ‘screening list’ in Administrative Guideline 90/5, prepared the PER and submitted it in December 1995 along with ap-proval applications (BHP Petroleum, 1995). How-ever, the JA required an EIS after it conducted the PER review. There was no scoping process carried out by the JA and the proponent simply adopted the general guidelines to prepare its EIS in terms of its content and scope of investigation. Following the request from the JA and a further study by the pro-ponent, the EIS was submitted in early 1996. It should be noted that the term for the EIA report is EIS according to Administrative Guideline 90/5, but the proponent called it an EAR (environmental as-sessment report) for its document.

The main activity of the Elang project was to re-cover oil from the Elang and Kakatua (Parrot) fields, located in the area ZOCA 91-12. These fields were approximately 150 km from Indonesia and 350 km from Western Australia. This oil field project was owned by a joint venture with the share holders: Petroz (14.95%), BHP (42.41%), Santos (21.4%) and Inpex Sahul (22.42 %) (Petroz, 1998; Aditjon-dro, 1999).

The Elang oil field development contained four oil wells — Elang-1, Elang-2, Kakatua-1 and Kakatua North-1. The main activities consisted of oil well development and transportation of the pro-duced oil to the FPSO (floating production, storage and offloading) vessel. The total investment for the Elang was US$105 million with the unit cost of de-velopment US$3.60/barrel based on P50 (proved and probable) reserves. The total estimated reserves was 54 million barrels of oil, which would be harvested over four years with the peak production rate as much as 33,000 barrels of oil per day.

BHP’s final EAR executive summary concluded that the “construction activities at the site are likely to be minimal because the riser and wellheads are to be constructed on land and shipped to the site and

the FPSO is free floating” (BHP Petroleum, 1996, page 1). Another conclusion was that the Elang site is not an important fishing ground, although it is known that fishing vessels often pass through the area or close by. Other environmental effects were illustrated as likely to be localised, small, minimal, and not considered to be high enough to cause envi-ronmental damage.

It is interesting to note that, although the EAR should be reviewed by the JA as well as being re-ferred to the relevant authorities according to Ad-ministrative Guideline 90/5, there was no formal EIA review conducted by the JA or its independent experts (personal communication, 13 July 1999). Therefore, further EIA processes were mainly based on consultation or comment from the authorities in both countries. The EAR was referred to the relevant authorities in Indonesia and Australia in early 1996. However, there was a degree of controversy about the commentary process for both parties.

Assessment by Indonesian EIA administration

On the Indonesian side, the EAR was first referred to the Directorate General Oil and Natural Gas (MI-GAS) for comments; responses were obtained on 6 March 1996. On 11 July 1996, the JA asked for clarification as to whether the EAR had fulfilled MIGAS requirements. MIGAS confirmed on 5 Au-gust 1966 that it had, except for minor issues, such as writing style and presentation of maps.

The commentary processes asked of the relevant Indonesian authorities were not clear. Therefore, when Bapedal was asked to provide comments re-lated to the EAR, it first investigated the direction of the EIA process. On 22 August 1996, Bapedal commented on the draft EAR about some issues including:

• a suggestion that the EIA report could be better discussed and reviewed by the Department of Mines and Energy, with Bapedal giving assistance during the review;

• a suggestion that the scoping process was made through the EIA TOR;

• identifying a miscommunication since the EIA Commission of the Department of Mines and

Although the environmental assessment report should be reviewed by the Joint Authority as well as being referred to the relevant authorities, there was no formal EIA review conducted by the JA or its independent experts

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Energy stated that it had never been contacted by the proponent.

On 27 August 1996, several sectoral departments held a meeting in the Bapedal office to evaluate the EAR. However, this was neither a formal meeting of the EIA Commission nor a formal EIA review pro-cess (as described in the Indonesian EIA regulations). Questions on whether the EAR needed approval un-der the Indonesian EIA system were continuing.

On 4 September 1996, the EIA Commission from the Department of Mines and Energy asked Bapedal to clarify the EIA process for the Elang project. Finally, Bapedal agreed that the decision was fully arranged under the JA’s responsibility, and did not require any approval from any Indonesian au-thority. This was supported by a confirmation letter from Bapedal on 15 October 1996 in replying to the letter from the EIA Commission of the Department of Mines and Energy that in the Timor Gap EIA procedure:

• no approval is needed by each country’s EIA legislation;

• the role of the JA is affirmed; • consultation (commentary) process to the related

authorities in both countries is provided; • no EIA Commission in Indonesia should handle

such EIA; • Bapedal may coordinate all related authorities in

making comments.

A further commentary process to the EAR was made under Bapedal coordination on 5 September 1996 involving the representatives from MIGAS, the De-partment of Foreign Affairs, and the EIA Commis-sion from the Department of Mines and Energy, Agriculture, and Defence, but not from NGOs. It was chaired by the Deputy Head of Bapedal, who was responsible for EIA development and technical guidance. The minutes were formally given to the proponent on 2 October 1996.

After the JA requested the submission of six cop-ies of the final EAR by the proponent to Bapedal on 12 December 1996, the JA made several confirm-ations to the Indonesian relevant authorities and requested a further discussion of the final EAR on 26 December 1996. On 3 January 1997, Bapedal notified that the final EAR had not included advice from the previous commentary process. The final reply on 6 January 1997 from the JA confirmed that the advice had been elaborated in the EAR.

Assessment by Australian EIA administration

The commentary processes in Australia started par-allel to those in Indonesia in early 1996 and have occurred several times since. Similar circumstances appeared on the Australian side. Some confusion has occurred over the basic interpretation of the Timor Gap Administrative Guideline 90/5 relating to the

Administrative Procedures under the EP(IP) Act 1974 (personal communication, 15 September 1999). For example, the term PER does not mean the same thing in these two guidelines and also the two EIA processes are different.

The question has been raised about whether the EP(IP) Act 1974 should apply to projects in the Timor Gap. The answer to this question depends on whether decisions made by the JA, which is consid-ered an international entity, require decisions by the Commonwealth Government. According to an offi-cer of the Environmental Assessment Branch, some have argued that it does not, and, therefore, deci-sions of the JA are not required to undergo EIA un-der Australian law (personal communication, 15 September 1999). It is a JA’s EIA rather than an EIA under national law.

There was no formal assessment of the Elang proposal by the Australian Environmental Assess-ment Branch. Moreover, public consultation has been avoided, the Australian portion of the JA refer-ring to Indonesian political sensitivities as the reason (personal communication, 15 September 1999). This is contrary to Administrative Guideline 90/5, which makes a particular provision for Australian EIA au-thority to advertise the EIS draft in order to encour-age public discussion. However, the commentary process has taken place and some issues were raised as follows (personal communication, 21 September 1999):

• The EIA process is an advisory one and has no le-gal implication on formal decision-making, which means that it was not an actual EIA assessment. The relevant authorities have no formal and legal role in decision-making. Decision-making is the JA’s responsibility.

• The Elang site is a new area and there was not a great deal of knowledge about it. This makes it of environmental significance and thus there is a need for EIA.

• The environmental significance issue is a result of the lack of baseline information on the site.

• Sensitivity of petroleum exploitation activities. • Considerations about the structure (concrete) on

top of the bank (or oil reservoir). • Potential oil spill. • Toxicity of used dispersants. • Effects of discharged water. • Hot water discharge. • Greenhouse gases from flaring activities.

Furthermore, a broader context of environmental assessments such as SEA or CIA has never been considered or encouraged for the Timor Gap EIA application by the Australian side. This was because of the lack of experience in that field, as well as technical and political inappropriateness for the Timor Gap implementation (personal communica-tion, 21 September 1999). In addition, although there are management provisions and monitoring

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measures that have to be completed by the propo-nent, no further effort was made to involve the rele-vant authorities in both countries. The authorities assumed that the JA followed up the environmental management and monitoring programme.

Following the environmental approval from the JA, the proponent commenced physical activities. The production stage started on 20 July 1998 (Petroz, 1988). However, as uncertain political situa-tions followed all related activities in the Timor area in 1999, BHP Petroleum finally sold all its shares to other members of the joint venture (Bisnis Indone-sia, 1999). Phillips Petroleum, an American-based company, then became the major shareholder, and responsible for the implementation of the project.

Discussion

The previous discussion indicates that there are four dissimilar EIA systems. Table 1 summarises the fea-tures of each EIA system.

Government and political involvement

EIA processes are not isolated from political inter-ests. Three main stakeholders are commonly in-volved: government; business; and community (including NGOs). Doyle and McEachern (1998) describe the relationship between the first two groups, stating that EIA is often considered as a form of government regulation imposed on business and resisted by business. In the Timor Gap EIA ap-plication, we need to discern that the Treaty was a mechanism for Australia and Indonesia to use pri-vate enterprises to exploit oil resources. According to Aditjondro (1999), the Treaty was pushed by Aus-tralia’s need to obtain oil and gas reserves because Bass Strait reserve is declining in the Gippsland Basin. This argument is coupled with the estimation that the Timor Gap contains about 5 billion barrels of oil and 50,000 trillion cubic feet of natural gas (Kompas, 1997).

There are also political interests involved in the Timor Gap. Formerly, Australia sought cooperation from Indonesia after it had failed to negotiate with Portugal (Blake et al, 1995). A high political in-volvement is evident, as can be seen from a cable sent by the former Australian Ambassador to Indo-nesia. This has been the case from the very begin-ning: the integration of East Timor into Indonesia in 1975 has always been disputed. Under the terms of the Treaty, politics takes precedence over EIA pro-cesses. Hence, it is possible that the interests of the project, whether political or economic, override the principle and best practice of EIA. In this case, EIA can bee seen as a ‘rubber stamping’ mechanism and only needed for the approval procedure.

Political involvement was also at work on the In-donesian side. For example, the EIA process was seen as a part of the JA’s responsibility. Therefore,

Bapedal and representatives from MIGAS saw to it that they were only involved during the consultation complementary to the EIA process carried out by the JA. There has never been a formal EIS review done by the EIA commission in Bapedal. The EIS com-mentary process in Bapedal was chaired by the Dep-uty for EIA of Bapedal, who was an appointed high-ranking officer from the Indonesian State Oil Company (Pertamina). Furthermore, there were im-pressions that the EIS had been assessed by the JA and the Australian EIA authority. Moreover, there were no NGO representatives in the consultation (or EIA review) process at the time.

Similarly, Environment Australia, which adminis-ters the review of the Timor Gap EIA document for the Australian side, conducted only a commentary process. According to the Environmental Assess-ment Branch of Environment Australia, there was no formal EIS assessment for the Timor Gap projects according to Australian EIA legislation (personal communication, 15 September 1999). It is interest-ing to note that decisions of the JA are not required to undergo EIA according to Australian law.

Furthermore, public consultation has been avoided so as not to harm Indonesian political sensi-tivities (personal communication, 21 September 1999). Australia wishes to maintain close political links with Indonesia, so the Timor Gap oil projects have been viewed as providing massive revenue for both countries. According to best EIA practice, it was obviously a tenuous argument for the Australian EIA administration to drop public consultation, but it could also be argued that the EIA approval was the JA’s responsibility. However, the Timor Gap EIA procedure only offered a ‘soft’ option: “The Austra-lian environmental authorities may request the JA to require the Contract Operator to meet the cost of ad-vertising the draft EIS for public comment in Australia” (in Administrative Guideline 90/5, JA, 1997a).

It rested on the Australian administration to decide whether or not to allow public consultation. Beattie (1995, page 112) notes that “EIAs will always be po-litical”, and the Timor Gap case is no exception. Therefore, to avoid a fault in decision-making,

Public consultation was avoided so as not to harm Indonesian political sensitivities: it was a tenuous argument for the Australian EIA administration to drop public consultation, but it could also be argued that the EIA approval was the Joint Authority’s responsibility

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Table 1. Differences in EIA systems

Timor Gap EIA system Australian EIA system Indonesian EIA system UN/ECE transboundary EIA system

EIA legislative frameworks 1. Regulation

The Treaty of Timor Gap 1989

The Australian Commonwealth EP(IP) Act 1974

The Indonesian Gov’t Regulation 51 of 1993

The Espoo Convention 1991 for UN/ECE

2. Regulatory system EIA is a part of permit system and has very strong legal implication

EIA is part of environmental legislation

EIA is part of environmental legislation

The Convention generally accentuates international cooperation and has no legal implication

3. Guidelines for EIA process

Administrative Guideline 90/5 Administrative Procedures under EP(IP) Act 1974

More than 14 guidelines under Environmental Ministerial decree, Head of Bapedal, Head of Sectoral Department Decree

Guidelines rely on the used guidelines in the Party of origin

EIA processes 1. Triggering

mechanism and screening process

Prescribed list. Administrative Guideline 90/5

Discretionary of the Action Minister based on a set of criteria.

Prescribed list and the Environment Minister’s discretion if necessary. Ministerial Decree 39 of 1996

Prescribed list (Appendix I) and the bilateral or multilateral agreement base on criteria on Appendix III

2. Level and type of EIA

Generic project-based EIA, no EIA categorisation (except of level of assessment PER and EIS)

Generic project-based EIA, no EIA categorisation (except of level of assessment: no assessment, PER/ EIS, and Inquiry)

Four types of EIA: single project; multi-project; multi-sectoral; regional

Generic project-based EIA, no EIA categorisation

3. Guidelines for EIS preparation, scopingprocess

General guidelines are set out by the Joint Authority without standardised format and structure Content of the report is specified

General guidelines and others are set out generically by Environment Australia without standardised format and structure

General guidelines are set out by Environment Ministerial Decree with standardised format, structure, and content Specific guidelines must be prepared by proponent with direction of stakeholders (reviewed)

Set out generically by Considered Parties without standardised format and structure, or it is decided by bilateral or multilateral arrangement

4. Times required for EIA process

No total time limitation, however, draft EIS should be advertised for minimum 60 days in Australia only

Limitation for public exhibition (28 days), additional information fulfilment and public review (21 days), assessment of PER (28 days) EIS (42 days), Environment Minister recommendation (PER 28 days, EIS 42 days)

Time limitation: the EIA evaluation should be undertaken within 57 business days: 12 days for EIS TOR; 45 days for EIS review

No total time limitation

5. EIS assessment authority

The Joint Authority with consultation of MIGAS, DPIE, Australian CEPA and Indonesian Bapedal

Environment Australia, DEST on behalf of Environment Minister

Three different EIA commissions: 1 integrated and regional EIA commission, 14 central EIA commissions, 27 provincial commissions

Set out by Considered Parties or by specific arrangement base on bilateral or multilateral agreement

6. Monitoring or auditing and management plan

Specifically required by Administrative Guideline. Formal document of Environmental Management Plan and Monitoring program Mandatory

Not specifically required by Act, based on assessment report request /recommendation Not mandatory

As a part of EIA process requirement. Formal document of Environmental Management and Monitoring plan Mandatory

Not specifically required by Act, based on assessment report request/ recommendation Not mandatory

Public participation processes 1. Public participation

methods Public comment and submission after media advertisement (in Australia only)

1. Public submission 2. Media publication 3. Public exhibition 4. Public meeting 5. Lobby group

1. Represented by NGO (mostly)

2. Public submission 3. Media publication 4. Public meeting

1. Public submission 2. Notification 3. Decided further by Considered Parties

2. Time for public participation

Minimum 60 days after media advertisement (in Australia only)

Minimum 28 days for public exhibition

No time limitation, community could voluntarily participate during all stages of EIA process

No time limitation, or decided by the Considered Parties

Note: DPIE is Department of Primary Industry and Energy (Commonwealth of Australia) Sources: Australian EIA Network (1996a, 1996b, and 1996c); Indonesian Government Regulation 51 of 1993 (Bapedal, 1993); BHP

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EIA regulations must assure that the overall EIA stages have some degree of certainty, uniformity and objectivity to avoid subjectivity or different interpre-tation. The role of the JA in terms of EIA admini-stration needs to be described further to avoid mismanagement of the EIA process.

Institutional framework

One critical point in managing the EIA processes is the EIA authority, where its main role appears in the review process. Gilpin (1995) claims that, besides the dominating influence of politics, institutional structures and the strength of environmental laws are of vital significance. Similarly, Ebisemiju (1993, page 252) claims: “[i]nstitutional arrangements deal with the type and effectiveness of the agency re-sponsible for management of the EIA system”. Therefore, a competent institution is very important in managing the overall EIA processes to ensure their effectiveness.

In the Timor Gap EIA system, the JA is the cen-tral authority that administers the EIA process and acts as a review body and gives approval, although it requests comments from the relevant authorities of both countries. Identifying the authority that will be responsible for the EIA processes was also consid-ered by guidance under the Espoo Convention (UN/ECE, 1996b). In the Convention, authorities re-sponsible for the EIA processes and other authorities to be involved at various stages of the EIA processes were determined beforehand, along with their roles and flow charts describing the various stages and timeframes of the processes.

In the institutional framework of the Timor Gap EIA system, there are two essential issues: resources of EIA expertise and an independent body to review the EIA documents. Indeed, utilising environmental experts from competent authorities in both countries can overcome the issue of EIA expertise. Therefore, there is a need to clarify whether relevant authorities in Indonesia and Australia are involved only for ‘comment’ or assessing the draft of EISs according to each country’s EIA procedures. Moreover, as suggested by the Espoo Convention, a regular ex-change of environmental information can be made during the EIA process. The JA can also optimise the role of independent experts who are engaged by the JA.

EIA legislative framework

Generally, EIA systems in both the Commonwealth of Australia and Indonesia have a comprehensive regulatory system for EIA implementation in con-trast to the bilateral or transboundary EIA schemes (the Timor Gap and the Espoo Convention), which only provide general guidelines. While the Timor Gap EIA process is only part of a permit system, the Convention’s provisions are more general in promoting environmentally sound development and

enhancing international cooperation in assessing transboundary EIA to avoid negative environmental consequences. There are no permit procedures among the involved countries in the Espoo arrangement, where the decision of the operation permit depends on a country (that is, the Party of origin). The concerned Parties can only influence the decision through the consultation process of EIA.

Referring to the Timor Gap EIA system, there is no term ‘Party of origin’ since the system is applied only in the Zone of Cooperation A (ZOCA) and managed by the JA, not by one party. It would be different if a development were proposed in Zone C (managed by Indonesia) for example. Then the In-donesian EIA and permit system will apply to the whole process and, in this case, Indonesia could be called the Party of origin since the activity is carried out in the Indonesian area and potentially affects the other party’s area.

Guidelines are essential for EIA application, since regulations usually cover a general provision for the EIA system such as stages, institutional frameworks or legal implications. An adequate EIS in an EIA system should comply with regulations and guide-lines at a particular time. Lambert and Wood (1990) argue that a good quality environmental statement can be interpreted as one that conforms to EIA regu-lations as well as approved procedures and methods.

The transboundary EIA under the Timor Gap Treaty is supported by regulations, directions and guidelines that have strong legal implications for the relevant proponents. In a different way, the Espoo EIA system is directed by, and mostly relies on, guidelines of EIA implementation in the Party of origin. The nature of the EIA system varies in each country according to its existing procedure and statutory instruments including external influences such as the European Community Directive. The Espoo Secretariat continuously develops supplemen-tary guidelines, specific methodologies, criteria and practical legal and administrative measures.

EIA processes

EIA procedures outline the formal processes in con-ducting EIA preparation and assessment. Ebisemiju (1993) states that EIA processes contain some procedures that arrange tasks among EIA partici-pants. Therefore, EIA procedures define the formal structure for carrying out the assessment, ensure uniformity, and guarantee that all environmental considerations are thoroughly and consistently examined.

Triggering mechanism and screening process De-termination of projects subject to EIA is the main reason for having a screening process. It is critical to optimise the EIA process. Harvey (1998, page 38) argues that the screening process “is essential to ra-tionalise the use of the formal EIA process and avoiding wasting time”. Referring to the summary in

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Table 1, all those systems adopt a prescribed list (screening list) except the Commonwealth, which uses discretionary mechanisms. The Timor Gap’s EIA uses a prescribed list, which has only three categories of activity that are subject to EIA re-quirements.

A valuable example of using a prescribed list is shown by the Espoo EIA system. A discretionary mechanism could produce inconsistency in two similar cases, while a prescribed list can be more consistent, although there is a risk of producing a long prescribed list. The crucial issue for using a prescribed list is the triggering criteria and thresh-olds. If inappropriately arranged, it would encourage the proponent to avoid the EIA process.

Level and type of EIA Different levels of assess-ment can also be used to screen and to categorise project proposals depending on the complexity and significance of environmental impacts. Dividing EIA into several types may enhance the quality of the assessment process because specific issues and the magnitude of impacts may converge. Harvey (1998) suggests that levels of assessment can be es-tablished to assist the needs of either the strategic approaches to environmental assessment, or the scoping process, which is reflected in some different terminologies used for EIA documents.

There are four levels of assessment in the Austra-lian Commonwealth EIA system: preparation of a PER; an EIS; ‘examination but no PER or EIS’ by DEST; and commission of inquiry. The PER differs from the EIS in terms of several criteria based on significance of impacts (Section 3.1.2 Administra-tive Procedures of EP(IP) Act). In terms of strategic approaches, when the Timor Gap EIA was applied, the Australian EIA system was still developing spe-cific EIA, such as strategic environmental assess-ment for policy, planning and programmes as well as an approach for cumulative impact assessment.

In contrast, Indonesia has only one level of as-sessment that is listed on the prescribed list. How-ever, the Indonesian system divides EIA into four different types: an individual or single-project EIA; ‘integrated or multisectoral’ EIA; ‘multiprojects’; and ‘regional’ EIA. The Timor Gap system uses two levels of assessment — the PER and the EIS. The Espoo system is different since its provisions are very general in the arrangement of the assessment criteria and processes. On the other hand, the as-sessment process depends on the Party of origin’s EIA system.

Scoping Scoping should be conducted in the early stage of the EIA processes to address crucial and significant environmental issues, and to include all the possible alternatives of a project implementation and its impacts. Glasson et al (1999) state that scop-ing is indeed a continuous process during EIA, where the suspected significant impacts are exam-ined in the further study and insignificant ones are

eliminated. Therefore, the scoping process will affect the overall effectiveness of the study and preparation of a particular EIS report.

The Timor Gap EIA has a simple scoping process. The content and scope of study are generally pro-vided in the guidelines. There is no further process of discussion or direction from the assessment au-thority in terms of scoping. This may be because the Timor Gap projects only apply to oil exploration and exploitation, and the scope of EIA study to some ex-tent is obvious to all stakeholders and decided earlier in the guidelines. Moreover, little variation occurs among proposed project activities in the Timor Gap or those concerning the environmental conditions of the area.

Timing of EIA process The timeframe to accom-plish EIA is essential since the right timing of the assessment process and time efficiency will influ-ence the overall planning process. The main aspects that influence the overall time consumption are evaluation, public participation and EIS preparation.

The Commonwealth of Australia and Indonesia set out a timeframe for their EIA stages. There is no provision in the Timor Gap EIA system in terms of time limitation for the finalisation of each stage of the EIA. According to the Director of the JA, time limitation in the preparation of EIS is not necessary because of a high degree of commitment among stakeholders as well as proponents to conduct the EIA investigation as soon as possible (personal communication, 13 July 1999). However, the Timor Gap system provides a minimum required time for comment from interested parties, which is at least 60 days. Similarly, transboundary EIA in the Espoo Convention does not arrange the amount of time needed to perform the overall EIA process.

EIS review process Lee and Colley (1991) empha-sise that the quality of environmental statements can be improved by providing systematic review of them. Glasson et al (1999) also suggest that the most important concerns of the review process are EIS comprehensiveness and accuracy. Therefore, discus-sion about the review process may not be separable from the issue of the competent authority or review bodies. Roberts (1991) ascertains that failings in en-vironmental assessment have prompted calls for a national agency to supervise and review environ-mental assessment.

The review process in the Timor Gap was a unique process since the only authority is the JA. However, it seems that there was a misunderstand-ing about the term ‘consultation’ set out by the Ad-ministrative Guideline in the review process. Consultation meant that Bapedal and the Environ-mental Assessment Branch (the CEPA) would give opinions, comments and suggestions to the JA (not to the proponent), and it did not mean that Bapedal and the CEPA conducted a formal EIS assessment or review.

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On the other hand, the JA has never done any formal EIS assessment (personal communication, 13 July 1999), but relies instead on the consultation or commentary results. Therefore, the EIA process is failing and it needs to be improved in terms of the EIS review. While the JA only consists of ten offi-cers, there is a provision for it to engage independent experts. However, in reality, the JA has never used that provision (personal communication, 13 July 1999). The JA simply compiled all comments from both countries’ relevant authorities and passed them to the proponent. Hence, the JA cannot be catego-rised as an assessment authority.

The Espoo EIA system provides the opportunity for a joint assessment through the joint body that provides environmental information exchanges re-garding EIA experiences. In the case of the Timor Gap EIS, there is no direct information exchange or agreed environmental standards to deal with a spe-cific project in that transboundary EIA between In-donesia and Australia. A direct joint EIA review between the relevant authorities of the two countries would perhaps give more comprehensive EIS results than current practice, as well as exchanging EIA ex-periences and expertise.

Monitoring, auditing and management plan Be-sides providing an environmental database, monitor-ing can improve project management and function as a key aspect for a successful auditing process. Buck-ley (1991) defines environmental impact auditing as the comparison process of the predicted impacts in an EIS with those actually occurring after project implementation. However, it seems that many developers perceive that EIA is only an obstacle that must be passed during the permit process and, once approval is obtained for a proposal, the EIA docu-ments are shelved. EIA is often seen as a linear pro-cess, where the only result that counts is the decision on a project. There is little opportunity for a cyclical learning process.

The Timor Gap system seems to adopt the Indo-nesian system in terms of requiring monitoring (and auditing) as well as a management plan in addition to PER or EIS. However, the reporting of environ-mental monitoring and management results is based

on self-reporting by the proponent (personal com-munication, 13 July 1999). In the Espoo system, post-decision activity should be carried out in so-called ‘post-project analysis’, which takes place when any Party requests it, to consider the likely significant adverse transboundary impact (Article 7(1), the Espoo Convention 1991). This activity includes surveillance and has several objectives in-cluding compliance monitoring, impact management review and verification of past impact predictions.

Requiring the environmental monitoring and management plan clearly is good practice to ensure the commitment of all stakeholders. Ebisemiju (1993) strongly suggests the involvement of con-cerned agencies in monitoring compliance and post-project audits to ensure that the project development is executed according to the approved EIS. Self-monitor practice and self-audit principle in the Timor Gap EIA system have eased the role of the JA as a supervising agency because they require only the minimum effort to supervise post-EIA activities; this is an advantage for the JA because it has a lim-ited number of officers. However, considering the environmental risks of sensitive activities, the JA or the competent authorities from both countries should consider the possibility of conducting a cross-checking mechanism through specific survey, inves-tigation or inspection procedures.

Public participation One essential aim of EIA is to communicate the process to decision-makers, and the decision should also be made after taking into account the community interest. Therefore, commu-nication of information about impacts should be made as widely as possible to all the stakeholders, including the public. Glasson et al (1999) argue that during the EIA process, public and statutory consul-tation can help to ensure overall EIA quality, com-prehensiveness and effectiveness. They add that various groups’ views are sufficiently taken into consideration by this process.

Little attention was paid to public participation in the Timor Gap EIA system. This is because the Timor Gap project is highly politically sensitive, and so public participation has been avoided by the JA and the relevant authorities from both countries. The Administrative Guideline mentions nothing about the role of the JA in involving the public in the EIA process. The only general provision was for volun-tary-based public participation, where the competent Indonesian and Australian authorities may seek comment from interested parties.

The Espoo transboundary EIA shows that public participation is encouraged from the beginning of the EIA process. The Party of origin shall provide an opportunity for affected members of the public to participate in relevant EIA procedures, and shall en-sure that the opportunity is equivalent to that pro-vided to the public of the Party of origin. The Convention also considers that opportunities for public participation differ from country to country

Monitoring provides an environmental database, and can improve project management and function as a key aspect for a successful auditing process, yet many developers perceive EIA as simply an obstacle that must be passed during the permit process

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(UN/ECE, 1996a), hence the concerned party should be informed of the chosen formal public participa-tion by the Party of origin.

Conclusion

This paper demonstrates a complex implementation of transboundary EIA, where preliminary evidence in the application of the Timor Gap EIA shows that it must be improved. The summary of the analysis is outlined in Table 2.

The overall implementation of the transboundary EIA in the Timor Gap was inadequate, though there were potential best EIA practices within the provi-sions of its guidelines such as the application of the EIS TOR and the appointment of independent ex-

perts. Several factors affected the application of the transboundary EIA and reduced its effectiveness. The fact that political and economic interests heavily influenced the nature of the EIA application and process —to obtain the Treaty’s objective and to jus-tify the approval procedure — has been overlooked.

The most critical issue in the case is the EIA re-view process since, without it, the quality and accu-racy of the EIA process is questionable. Therefore, a consistent EIA implementation scheme along with goodwill from the involved countries is essential and the JA must properly fulfil its role. Indeed, the Timor Gap EIA system had good provisions, where the JA could conduct a formal EIA review and hire independent experts. However, in practice, there was no formal EIA review. It is strongly recommended that the formal EIA review process should

Table 2. Summary of Timor Gap EIA system and its implementation

EIA essential determinant

Comment and implementation Recommendations

Political Sensitive issue, economic and political interests General best practice of EIA was overridden

It can use other tools of decision-making, but not EIA If EIA were to be used, regulation and the supervising authority shall be arranged to ensure objectivity and certainty of EIA process Independent review body or experts is needed

Legislation

Regulatory system is too general, the EIA is part of permit system. Simple EIA guidelines

Regulation should ensure that the role of the supervising authority includes the full range of EIA stages at the best practice Besides independent or experts panel of review body, both countries’ environment portfolio can be used for joint review Strategic approach for overall environmental management may be consideredDetailed guidelines can be developed, and may include standardised format and content of EIA report

Triggering and screening stage

Using a prescribed list Appropriate criteria and triggering thresholds can be developed to complement the prescribed list Discretionary principle or call-in power to request an EIA process is also essential to elaborate or anticipate specific cases

Level and type of EIA Two levels assessment: PER and EIS Single type EIA

Level of assessment is crucial for transboundary EIA with various activities, not for relatively homogeneous and few activities It is possible to consider several types of EIA in transboundary context such as SEA and cumulative impacts

Scoping stage

No formal scoping stage Scope of EIA study is set out by the EIA Guidelines

Formal scoping process needs to be elaborated Project-specific guidelines or terms of reference of EIA can be used to elaborate the formal scoping process Exchange of information related to environmental matters between the involved countries is also essential during this stage Standardised EIS format can be added in the general guidelines

Timing No time limits in each stage of EIA process

Timeframe for several stages of EIA process can be made to promote a commitment in performing the whole EIA process and efficient administrative procedure, ensure some degree of certainty, and to avoid erroneous perception of EIA process

Review of EIA report In practice, there is no formal EIA review process The JA fully relies on the result of commentary process

The JA should perform a formal EIA review process If the JA were not able to do so, both countries’ related authorities should perform a direct joint review to ensure the accuracy of EIS rather than only a ‘comment’ process Optimising the provision to engage independent experts panel Information exchange including environmental issues, standards and experiences may enhance the review process

Public participation There is a possibility of conducting the public participation process In practice, this stage has never been performed

Although the public participation stage is a very volatile issue in the sensitive political nature of the Timor Gap, public participation has to be elaborated, or the EIA process cannot be used here Equal treatment for the communities of all involved countries to participate in the EIA process is essential Time limitation in this stage is crucial to avoid endless debate

Monitoring, auditing, and impact management

EMPs are required by the EIA Guidelines Monitoring and auditing are performed by the proponent

Besides self-monitoring or auditing and self-reporting mechanism by the proponent, the JA may develop a cross-checking investigation or conduct independent monitor and auditing Role of the related authorities in supervision of EMPs implementation needs to be considered The result of monitoring and auditing needs to be publicised

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be undertaken. Using independent experts to review EIS documents should be maximised considering the limited number of JA officers.

In addition to the fact that the Timor Gap’s EIA regulatory system and its guidelines are too general, a more strategic approach for the transboundary EIA is a valuable consideration. Several stages in the Timor Gap’s EIA, such as screening, scoping and public involvement also need improvement. The transboundary EIA should ensure that all communi-ties in the involved countries are given equal oppor-tunity to participate publicly. To ensure the effectiveness of the monitoring plan conducted by the proponents, the relevant authorities may need to develop a cross-checking, monitoring and auditing scheme. Finally, all the above weaknesses should be considered in formulating new environmental regu-lations for East Timor.

Postscript

The investigations conducted for this research led the Indonesian Environmental Impact Management Agency to realise that it had no provision regarding transboundary EIA in its environmental regulatory system. Therefore, the latest amendment to the EIA regulatory system, Government Regulation no 27 of 1999 (Bapedal, 1999), had as one of its new features the provision for transboundary EIA. This new regu-lation was a direct outcome of the research project on the Timor Gap EIA in early 1999.

Provisions have recently been amended in the Australian Commonwealth EIA system by the promulgation of a new environmental Act: the Envi-ronment Protection and Biodiversity Conservation Act (EPCB Act) in 2000. The new Act has compre-hensive provisions on bilateral agreements in envi-ronmental protection (chapter 3 of EPCB Act), including an environmental assessment and approval process (Environment Australia, 2001).

Although the provisions are intended to provide agreements between the Australian Commonwealth and a state or self-governing territory in Australia, this model could be utilised when a specific bilateral agreement is needed for environmental assessment with other countries. Furthermore, the new Act also has provisions on strategic assessments in chapter 4 part 10, which are to be used for the purposes of, among others, trade or commerce between Australia and another country. This is particularly relevant and a potentially powerful tool to assess a transboundary impact assessment similar to the Timor Gap in the future.

The majority of East Timorese chose to be inde-pendent from the Republic of Indonesia’s sover-eignty after a referendum on 30th August 1999. This was approved by Indonesia’s MPR (People’s Consul-tative Assembly) on 19 October 1999 (Kompas, 20 October 1999). The consequence of this is either to abolish the Timor Gap Treaty or amend it. However,

the Timor Gap Treaty ceased to be in force with Indonesia soon after the UNTAET took over admini-stration of East Timor on 29 October 1999 (DFAT, 2003), but the term ‘Timor Gap’ was still used, with East Timor replacing Indonesia’s position.

A new agreement was signed on the independence day of East Timor, 20 May 2002, between Australia and East Timor: the Timor Sea Treaty (Sherlock, 2002). Finally, East Timor and the Australian Fed-eral Parliament ratified the Timor Sea Treaty on 6 March 2003, amidst contradictions suggesting that all revenue should be accrued for East Timor and al-legations that Australia had used heavy-handed tac-tics to compel East Timor to ratify the Treaty (Paul, 2003; Lewis and Wilson, 2003; ABC online, 2003).

Detailed regulations and guidelines will certainly be prepared to support the implementation of the new Treaty including environmental matters. East Timor should be aware of these and the lack of any previous implementation of transboundary EIA as shown in this paper. Therefore, the lessons learnt from the previous Timor Gap EIA implementation are important for the future formulation of environ-mental regulations in East Timor, especially related to transboundary EIA.

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review of transboundary environmental impact assessment: a case study from the timor gap

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