Oil dispute a hiccup in relations: KL

The tense standoff between Malaysia and Indonesia over a disputed offshore oil field is merely a hiccup in relations that's being blown out of proportion by the Indonesian media, The Jakarta Post reported in its Wednesday edition citing Malaysia's foreign minister as saying.

Foreign Minister Syed Hamid Albar was scheduled to depart for Jakarta on Wednesday for three days of talks with Indonesian counterpart Hassan Wirayuda on the overlapping claims, which prompted both sides to deploy warships in recent days and accuse the other side of trespassing.

"The media in Indonesia have initiated a tremendous raising of feelings," Syed Hamid told reporters. "I think this is not beneficial. We should resolve the issue through negotiations and talks. We should not make the situation worse."

He did not give examples of news reports that he considered overblown.

The dispute over the oil field in the Sulawesi Sea off Kalimantan Island's eastern coast further sours relations that have been made tense recently over Malaysia's expulsion of hundreds of thousands of illegal Indonesian workers.

The long-standing dispute re-emerged in February when Malaysia's national oil company, Petronas, awarded production-sharing contracts to two of Shell's Malaysian units and to Petronas Carigali Sdn. Bhd. for two deep-water blocks.

Indonesia said the oil blocks are within its borders. The blocks are near Sipadan and Ligitan islands, disputed for years between Malaysia and Indonesia.

The International Court of Justice gave Malaysia sovereignty over the islands in 2002. But Indonesia claims Malaysia's water territory extends only 12 nautical miles from the islands.

On Monday, Malaysians Prime Minister Abdullah Ahmad Badawi and Indonesian President Susilo Bambang Yudhoyono sought to defuse tensions by talking to each other by phone for 10 minutes. They agreed that their foreign ministers would resolve the matter through negotiations.(*)