China now extracting oil from disputed waters

From the Philippine Star (Dec 30): China now extracting oil from disputed waters

China’s largest offshore oil and gas producer has announced that two of its oil fields in disputed waters in the South China Sea (West Philippine Sea) have started production.A report of the state-owned China Daily yesterday said the China National Offshore Oil Co. Ltd. (CNOOC) announced on Friday the operation of the oil fields in the contested waters. In a statement, the CNOOC said both oil fields are located in the Pearl River Estuary Basin. The report said the Panyu 4-2/5-1 field, one of the two oil fields, is expected to reach its peak output level in 2014. The CNOOC owns 75.5 percent of the field, while Burlington Resources China Llc. owns the rest. The other field was identified as Liuhua 4-1. The company owns it completely and expects its production to peak next year.

In June, the CNOOC announced it would open nine new blocks in the South China Sea to bids for exploration and development. The blocks are in disputed waters directly off Vietnam’s coast, in some cases within 100 nautical miles of Vietnam’s shores. A few days later, the Chinese Defense Ministry announced that it was preparing to start regular naval patrols in the waters around the Spratly Islands, which are being claimed also by Brunei, Malaysia, the Philippines, Taiwan, and Vietnam. Vietnam protested the CNOOC announcement on the opening of nine oil and gas lots for international bidders in areas overlapping with existing Vietnamese exploration blocks. Vietnam said the lots lie entirely within its 200-nautical mile exclusive economic zone and continental shelf.

Malacañang, on the other hand, said the Philippine government would continue to call on China to respect the country’s territorial integrity and sovereignty as stipulated in the United Nations Convention on the Law of the Sea (UNCLOS). Malacañang issued the statement after the Department of Foreign Affairs (DFA) protested China’s sending of an oceangoing patrol vessel to disputed waters in the West Philippine Sea on Thursday. “The Philippines again calls on China to respect our territorial sovereignty and EEZ (exclusive economic zone). The Philippines strongly objects to the Chinese patrol of Philippine maritime domain in the West Philippine Sea,” the DFA said. “Such patrol will not validate the nine-dash lines and is contrary to China’s obligation under international law including UNCLOS,” the DFA added.

China announced the deployment of Haixun 21, the first oceangoing patrol vessel equipped with a helipad, to conduct maritime patrol in the West Philippine Sea.Haixun 21 is the first of its kind to be put into service in the West Philippine Sea and will be under the administration of the Hainan Maritime Safety Administration, according to state-run Xinhua news agency. Haixun 21, which is equipped with a helipad, is under the control of the Hainan Maritime Safety Administration. Huang He, deputy head of the maritime bureau of the Ministry of Transport, said the vessel’s principal mission is to monitor maritime traffic safety, investigate maritime accidents, detect pollution, carry out search and rescue work, and fulfill international conventions. The Chinese Defense Ministry said China only intends to build “harmonious oceans” and protect its maritime sovereignty with its deployment of patrols in the disputed waters.

Malacañang said it remains committed to finding a peaceful resolution to the dispute and avoiding provocative actions. It said President Aquino is now being recognized in the global community as a champion of peace with his vigorous effort to bring the issue to a multilateral and diplomatic conclusion. The government earlier in May asked the Federation of Filipino-Chinese Chamber of Commerce and Industry Inc. (FFCCCII) to consider investing in Philippine companies undertaking exploration activities in the country’s continental shelf. Assistant Secretary Gilberto Asuque of the DFA’s Ocean Concerns Office encouraged the federation’s members during a meeting organized by the FFCCCII in Manila to invest in an energy exploration project in the Philippines’ continental shelf that includes Recto Bank (Reed Bank), which China is also claiming as its own.

Scientific data showed the West Philippine Sea contains vast deposits of oil and natural gas. The area around Recto Bank alone has an estimated 16.6 trillion cubic feet of natural gas, enough to last for a century, according to the Department of Energy. Asuque also assured the public that the government is protecting the rights of Filipinos in their territory as well as the Philippines’ marine resources as provided for under local and international laws, including the UNCLOS.

http://www.philstar.com/headlines/2012/12/30/891423/china-now-extracting-oil-disputed-waters