After East Timor, or Timor Leste, became independent in 1999, it made provisional maritime border agreements with Australia.
The 2002 Timor Sea Treaty established the Joint Petroleum Development Area (JPDA), which would result in income from oil revenue being shared between both countries.
Exploitation was to continue for a period of 50 years after which a fixed boundary line was to be established.
But critics in East Timor were never happy with the arrangement, saying that they were compelled to accept deals that had been signed before independence.
Moreover, they say that Australia has not abided by agreed levels of revenue generated by the oil exploration.
Some activists even say that the current treaty “makes the poorest nation in Asia the largest donor of foreign aid to the richest”, in the words of the Australia East Timor Assocation Incorporated.
“What Timor Leste claims is very simple, very basic, it is nothing out of this world, and that is: soonest we should agree on maritime boundaries and follow the international practise and draw a median line,” says former president José Ramos Horta, speaking at a forum of the International Peace Institute at the eve of the court case.
But there is not much faith in a positive outcome.
“I'm not very optimistic about Australia,” says former president and current minister for Planning and Strategic Investment Xanana Gusmao, who is leading the East Timorese delegation to The Hague.
“A former prime minister of the UK said 'no permanent allies, no permanent friends, but permanent interests'. This is the mindset of powerful nations when they deal with small countries like ours.”
He is not alone in his opinion.
“From the beginning, Australia always fought in favor of Indonesia, stood by [former ruler] Indonesia until the last day, until 1999, before it changed its policy,” says Estevao Cabral a former East Timorese freedom fighter contacted by RFI.
“And on the day when Timor declared the restoration of independence, Australia pulled out from the International Court of Justice in order to avoid these kind of negotiations. I am very disappointed in Australia.”
During their opening statements yesterday, the Australians were indeed defiant.
“We contest the competence of the commission,” says Gary Quinlan, who lead the Australian delegation to the court.
“Australia's view is that there is no proper basis on which Timor Leste is entitled to bring this claim. Doing so violates treaty commitments, specifically the 2006 treaty on certain maritime arrangements in the Timor Sea under which both countries have committed not to bring proceedings against each other on maritime boundaries.”
Australian analysts say their country is willing to discuss.
“I think Australia has been mindful of Timor Leste's needs to seek to bring about a permanent settlement of the maritime boundaries,” says Donald Rothwell, a profess of of international law with Australia National University.
“It is respectful of its rights as a new independent state to seek to explore peaceful mechanisms for dispute settlement. I do not see this process in any way unsettling the otherwise good relations between the two countries.”
Moreover, the existing treaty helped East Timor to reconstruct after decades of war, he says.
“The treaty framework has provided a certainty and stability to enable the early exploitation of the resources, so revenue could start flowing immedeately to Timor Leste,” says Quinlan.
“The stable revenue provided by the 2002 Timor Sea Treaty was particulary important for supporting Timor Leste's recovery from conflict and economic development in the first years of its independence."