Government officials from Japan and New Zealand have met in Wellington to discuss who was responsible for a collision between two vessels in the waters off Antarctica yesterday.
Sea Shepherd's carbon-fibre speedboat the Ady Gil was sheared in two in a clash with Japanese whaling ship Shonan Maru 2.
New Zealand is handling an investigation into the incident because the Ady Gil is registered in that country.
The Sea Shepherd is adamant the whaling ship is to blame as the Ady Gil was not in motion at the time of the incident.
But Japan's Institute of Cetacean Research (ICR) says the Ady Gil was trying to cut off the Shonan Maru 2.
Japanese whalers say their ship was trying to take evasive action when the incident happened, and say whaling ships had been under "continuous attack" from the Ady Gil and another Sea Shepherd vessel in the hours leading up to the collision.
New Zealand's foreign minister, Murray McCully, has held a press conference in Auckland, saying the collision should be a wake-up call to both sides as someone could have easily died.
He says he wrote to both Sea Shepherd and Japanese whalers before Christmas, asking them to show some respect and restraint, but it clear no one was listening.
There were media reports in Australia today that Japan was issuing a "stern" official complaint to New Zealand over the incident, but this has been denied by a spokesman for Mr McCully.
Maritime New Zealand and the Transport Accident Investigation Commission are currently investigating the incident and Mr McCully says he expects its progress will be announced later tonight.
New Zealand Prime Minister John Key was recently in Japan to foster healthy relations, but New Zealanders, who pride themselves on being green, do not want him to take a soft approach over whaling.
Acting Prime Minister Julia Gillard says she has been personally shocked by the confrontation.
She has asked the Australian Maritime Safety Authority (AMSA) to conduct its own investigation and says the results will be made public once it is completed.
"The important point today is the conduct of people in the Southern Ocean. We support the right to peacefully protest, but it is not over-dramatic to say lives are at risk here," Ms Gillard said.
"I've see the video footage of this incident. It is concerning. It is disturbing.
"It seems to me a very lucky escape for the people involved that no one was more grievously injured or something even worse."
She has called for calm judgements to prevail during the operations at sea.
However Ms Gillard has resisted calls from the Opposition and the Greens to send a ship to the Southern Ocean to police the situation.
The Government sent the customs ship Oceanic Viking to the Southern Ocean two years ago to collect evidence of Japanese whaling in preparation for possible international legal action.
But Ms Gillard says a similar move this year could be counter-productive.
"Some might suggest the presence of the vessel monitoring and observing emboldened actions and we certainly wouldn't want to see that," she said.
However the Opposition's environment spokesman, Greg Hunt, refutes Ms Gillard's reasoning behind not sending a ship.
"It's a little bit like the police refusing to go to the scene of a riot because they say to turn up might make things worse," he said.
"There is a major conflict - we've had both sides talk about increased tensions.
"This is the moment for national responsibility, not for the Government to wash its hands."
Ms Gillard says the Government reserves the right to take international legal action if diplomacy with Japanese officials fails, and has warned that evidence has already been collected to launch such action.
She says the collision took place within Australia's search and rescue zone, but outside its economic zone.
However Dr David Leary from the University of New South Wales says only a small number of countries recognise Australia's claim to Antarctic territories.
He says any legal intervention could backfire and a worst-case scenario would be an international court ruling Australia's claim to its Antarctic territory is not legitimate.
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