China, Vietnam, and Contested Waters in the South China Sea

5 MINS READJun 1, 2011 | 12:06 GMT
Chinese patrol boats once again harassed a seismic survey ship in disputed waters in the South China Sea, another sign of Beijing's increased assertiveness over sovereignty claims and opposition to unilateral exploration. Since China became a net importer of oil in 1993, it has seen a nearly double-digit growth rate in domestic demand. Preferring a bilateral approach to exploration with Chinese involvement, Beijing is not averse to using intimidation tactics to satisfy its growing energy needs.
The longstanding dispute over contested waters in the South China Sea has again flared up between China and Vietnam. Early in the morning of May 26, according to Vietnamese state media, the Vietnamese-operated M.V. Binh Minh 02 research vessel detected by radar three approaching Chinese patrol boats while it was conducting a seismic survey of Block 148, above the country's 200-nautical-mile continental shelf. They transmitted a warning to the vessels but received no response. About an hour later, three Chinese boats sped through the area and cut the cables connected to the hydrophone streamer the ship was towing. The Chinese boats reportedly left the scene after about three hours. The Vietnamese Ministry of Foreign Affairs issued a statement May 28 protesting the incident and demanding that China immediately cease such behavior and stop violating Vietnam's sovereignty and jurisdiction over its continental shelf and exclusive economic zone (EEZ). The ministry also stated that China's action had violated the 1982 U.N. Convention on the Law of the Sea, which allows free passage in international waters, as well as the Declaration on the Conduct of Parties in the South China Sea signed in 2002 by China and members of the Association of Southeast Asian Nations (ASEAN). In response, the Chinese Foreign Ministry claimed that Vietnam had infringed on China's interests and management rights in the South China Sea by exploring for oil and natural gas in its waters and that the May 26 actions by the patrol boats were in full compliance with international maritime law. China also warned Vietnam not to create "new incidents" in disputed areas of the South China Sea. The incident occurred about 120 kilometers (80 miles) from Vietnam's southern Phu Ye province and 600 kilometers south of China's Hainan province. PetroVietnam Technical Service Corp., an affiliate of Vietnam's state-owned oil and natural gas producer, PetroVietnam, had dispatched the seismic survey ship Binh Minh 02 to survey blocks 125, 126, 148 and 149 within Vietnam's EEZ and above its continental shelf. Such surveys in the area, part of PetroVietnam 2011's oil and natural gas exploration program, have been conducted twice in the past, once in March 2010 and once in March 2011. A similar incident occurred early in March when two Chinese patrol boats harassed a Philippine research vessel while it was conducting a seismic survey in the Reed Bank area. This most recent incident suggests Beijing is maintaining its assertive stance on sovereignty claims in the South China Sea and its standing policy to oppose any unilateral exploration. (Virtually the entire sea is disputed, with China and Taiwan between them claiming almost all of it, with overlapping claims by Vietnam, the Philippines and other Southeast Asian states.) Beijing's strategy is to try to resolve conflicting territorial claims in the South China Sea bilaterally, with Chinese involvement, and avoid any multilateral resolution. By conducting joint exploration with one or two countries at a time, China can strengthen the legitimacy of its territorial claims and prevent any outside interference. Indeed, despite Beijing's latest so-called charm offensive in its neighbors' regard, Beijing is still keenly interested in the South China Sea. This interest derives in large part from China's growing energy needs. Since the country became a net importer of oil in 1993, it has seen a nearly double-digit growth rate in domestic demand. The country's dependency on foreign oil is now at 55 percent, which poses a genuine threat to its energy security. China is aware of its exhausted onshore reserves and import limitations and is looking to shift its focus to offshore exploration, particularly in the South China Sea. Over the past few decades, offshore discoveries accounted for a little more than half of new oil production by China, and by 2010 they had reached 80 percent. A report recently published by China's semi-state-owned Global Times estimates that disputed waters in the South China Sea contain more than 50 billion tons of crude oil and more than 20 trillion cubic meters of natural gas. To facilitate the continuing move offshore, the state-owned oil giant China National Offshore Oil Corp. (CNOOC) reportedly will be stepping up its oil exploration in the South China Sea, particularly in deeper waters, over the next five years. According to CNOOC officials, China has so far explored only the northern part of the South China Sea, which has yielded a limited amount of oil and natural gas. However, other countries claiming disputed waters, according to CNOOC, may produce more than 20 million tons of oil equivalent from the sea each year. Turning its exploration focus to the south, CNOOC is planning to invest $30 billion in deepwater drilling between now and 2016. As part of this move, a 3,000-meter (nearly 10,000-foot) semi-submersible, ultra-deepwater drilling platform christened "Offshore Oil 981" was delivered to CNOOC in mid-May. The platform is expected to be in use in the South China Sea by July. While it is unclear which blocks CNOOC is specifically planning to explore, the company hopes to greatly enhance its capabilities in the southern part of the South China Sea, which will lead to more direct disputes with other territorial claimants. The Philippines and Vietnam, in particular, have been pressing energy exploration as well as advocating a multilateral approach to challenge China's sovereignty claims. They are also hoping to pursue a more unified path within the ASEAN countries to attract attention from outside the region, particularly from the United States, which wants to gain a foothold to curb China's regional expansion. With Beijing's more frequent sovereignty claims and expanding military capability, more tension in the South China Sea can be expected.

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