Nov 7, 2016 | 09:30 GMT

7 mins read

In the East China Sea, China Crosses a Line

In the East China Sea, China Crosses a Line
(VCG/Getty Images)
Forecast Highlights

  • China's renewed natural gas exploration in the East China Sea could stoke tensions with Japan.
  • Tokyo, concerned that Beijing will try to extend its maritime boundary eastward, will do what it can to reinforce the median line and protect its control over the Diaoyu/Senkaku Islands.
  • Beijing will leverage Tokyo's request for talks on joint exploration to boost its standing in their maritime disputes in the East and South China seas.

After years on pause, China's exploration for natural gas deposits beneath the East China Sea has begun to ramp back up, and it is starting to make Japan nervous. On Nov. 1, Tokyo lodged a diplomatic complaint against Beijing after it discovered a Chinese drillship moored and operating near several natural gas fields in the disputed waters. It was just the latest in a series of protests by Japanese officials, who throughout October have claimed that sightings of natural gas flares indicate the construction of as many as 12 Chinese drilling platforms in the East China Sea, in addition to the four installed there before 2005. If Japan's suspicions are verified, China's activities could complicate the provisional agreement Tokyo and Beijing reached in early September to resume talks on jointly developing the East China Sea's energy resources.

The Bigger Issue at Stake

Despite the hype surrounding the potentially lucrative hydrocarbon reserves of the East China Sea's bed, China and Japan's interests in the waters have little to do with energy. In fact, the complexity of the seabed's geographic features largely has made drilling prospects there — particularly in its eastern half — uncertain at best. The resources that have been proved, moreover, amount to a fairly minor share of either country's total energy demand. The U.S. Energy Information Administration estimates that the East China Sea holds 200 million barrels of proved and probable oil reserves as well as between 30 billion and 60 billion cubic meters of natural gas reserves. At most, that would be enough to meet two months of Japan's oil demand and six months of its natural gas needs. It would fill an even lesser proportion of China's energy demand.

Why, then, are China and Japan so interested in the East China Sea? The answer lies in strategy. The sea rests at the heart of a long-standing dispute over where Beijing and Tokyo believe their maritime boundaries should be drawn. Japan has historically maintained that the median line evenly splitting the nautical distance between the two countries should delineate their border, with waters on the eastern side of that line belonging to Japan and waters on the western side belonging to China. (According to this demarcation, the Diaoyu/Senkaku Islands contested by the two would also indisputably fall on the Japanese side of the line.) Consequently, Tokyo's strategy in the East China Sea has been to enforce the median line boundary, keeping Chinese vessels at bay and building up its presence in the sea's eastern waters. But China, too, has an interest in the Diaoyu/Senkaku Islands, and for decades it has sought to expand its maritime claims eastward. However, it was not until about six years ago that Beijing had built up the military and naval capabilities to do so. China's clashes with Japan over the coveted island chain have intensified since.

A Seabed Skewed in China's Favor

The imbalanced distribution of exploitable energy resources in the East China Sea has only exacerbated those tensions. For instance, the Xihu and Okinawa troughs — which fall on the Chinese and Japanese sides of the median line, respectively — are believed to be the areas of the sea with the greatest resource potential. But the latter, which rests at an average depth of 2 kilometers (1.2 miles), has far less favorable operating conditions. As a result, the bulk of the resource development that has occurred so far in the East China Sea has been done by China. (Many natural gas fields in the sea's western half now provide a steady supply of energy to the industrial bases on China's eastern coast, including Shanghai and Ningbo.) By contrast, Japan's attempts to explore the eastern seabed have been fairly infrequent. Though some Japanese oil companies made early ventures into the sea, Tokyo halted their activities in the 1970s as it began to normalize ties with Beijing. Subsequent efforts in the late 20th century likewise failed, thanks to disappointing discoveries and Chinese objections.

Japan watched China's own exploration efforts in the 2000s with growing unease. Fearing that Beijing's construction of numerous drilling platforms would someday threaten the integrity of the median line, Tokyo responded by vocally criticizing its rival's activities and harassing Chinese vessels. China — which at the time was still militarily weak relative to Japan — had little choice but to halt production at its sizable Chunxiao field. Meanwhile, Tokyo renewed its efforts to unilaterally develop the eastern half of the sea's resources. 

In 2008, China and Japan took steps to lay their territorial dispute to rest. They struck a deal whereby they would jointly develop 2,700 square kilometers (1,042 square miles) of seabed straddling the median line. Beijing also agreed to allow Japan to invest in the Chunxiao field. Yet the agreement was never put into practice. Tokyo deemed China's claims of sovereignty over joint development zones unacceptable, and a fishing dispute near the Diaoyu/Senkaku Islands in 2010 largely destroyed any hope left of cooperation. Talks on joint development ground to a halt, and the status quo in the sea froze — just as China began to bolster its naval defenses.

Marching the Median Line East

Today, Japan's powerful coast guard retains the upper hand in the East China Sea. But China is quickly closing the gap, and it may not be long before Beijing's naval forces outstrip Tokyo's, even as Japan accelerates its own remilitarization. This poses a serious problem for Tokyo: As development of the eastern side of the median line continues to lag, and as Beijing's maritime capabilities improve, Japan may have a harder time stopping China from pushing its territorial bounds eastward.

Notably, all of the new Chinese drilling platforms that have sprung up over the past few months are still on Beijing's side of the median line. But they are also all located within 60 kilometers of it; the Chunxiao field lies a mere 5 kilometers away. Tokyo is becoming increasingly concerned that Beijing could use undersea exploration to extend its reach into Japanese waters, thereby weakening the strength of the median line as a defining maritime barrier between the two powers. To make matters worse, the Japanese Foreign Affairs Ministry recently disclosed that one of China's platforms is equipped with a military-grade surface radar system. Though the use of radar is not uncommon in natural gas facilities, the installation will certainly improve China's awareness of activity in the East China Sea, a worrisome prospect for Japan.

In response to China's resumption of drilling so near the median line, Japan may feel that it has no choice but to resort to harassment tactics and a defensive buildup around the Diaoyu/Senkaku Islands. Though Tokyo has repeatedly asked to revisit the 2008 joint exploration deal with Beijing, China's growing tactical advantage in the East China Sea has reduced its incentive to return to the negotiating table. That said, Beijing could try to leverage Tokyo's desire for a deal to seek better terms in their disputes, not only in the East China Sea but also in the South China Sea, where Japan has been asserting its claims more aggressively. But with its naval capabilities improving, China has no intention of abandoning its push across the median line and toward the hotly contested Diaoyu/Senkaku Islands.

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