The South China Sea’s untapped oil and natural gas are back in focus
https://qz.com/1037896/south-china-seas-untapped-oil-and-natural-gas-back-in-focus/The contested South China Sea has large deposits of oil and natural gas. Perhaps luckily for the environment, drilling for these resources has been discouraged by political tension among nations in the region. In particular, energy companies worry about China’s ongoing insistence that everything within its infamous nine-dash line—which marks off nearly the entire sea—is its own territory, despite an international tribunal invalidating the sweeping claim last year.
The uncertainty has made it hard for energy companies to justify the hefty investments needed to extract carbon resources from below the sea floor. Recently, though the carbon resources have started to make headlines again, with Vietnam, Indonesia, and the Philippines—and, of course, China—all involved. It’s a reminder that however quiet the issue gets at times, untapped energy riches are a key element to the South China Sea contest.
Reed Bank (also called the Reed Tablemount) is one of the major prizes in the South China Sea. Located near the Philippines coast, it is believed to hold large reserves of oil and natural gas. The nation’s main source of natural gas, the Malampaya field, will run out in less than a decade.
Reed Bank clearly falls within the exclusive economic zone of the Philippines. As set forth by the UN Convention on the Law of the Sea, an EEZ extends 200 nautical miles (370 km or 230 miles) from the shore. (Reed Bank is 85 nautical miles off the coast.) While the zone can be treated as the high seas in most regards, all the resources within it belong to the coastal nation. The Philippines should be free to partner with any energy company it desires to extract those resources, and then use them as it sees fit.
According to the nine-dash line, Reed Bank belongs to China. When the Philippines has tried to explore there, China has stopped it. In 2011, Chinese patrol vessels nearly rammed a survey ship operating with permission from the Philippines. And in 2014, Manila criticized China for conducting regular “sovereignty patrols” in the area.
Now, Reed Bank is back in focus. On July 12, a Philippine energy official said drilling at Reed Bank could resume before year’s end, with Manila getting ready to offer new blocks to investors via bidding in December. Ismael Ocampo, an energy official, said he was hopeful that China would not complain or harass the crews of survey ships this time around....
...Vietnam recently stopped a gas drilling operation located about 400 km (250 miles) off its southeast coast after receiving threats from China, according to a BBC report this week. While Vietnam had leased the area to one company, China had leased it to another. China threatened to attack Vietnamese bases in the Spratly islands unless the drilling stopped, according to the report....
...On July 14, Indonesia announced a new name—the North Natuna Sea—for the northern reaches of its exclusive economic zone in the South China Sea. Again, the nine-dash line overlapping with an EEZ was a big reason why. Within the overlapping area is the East Natuna Gas Field, one of the larger such fields in the world....
