China backs joint energy development with Philippines in disputed sea

MANILA (Reuters) – China’s foreign minister on Tuesday said he supported the idea of joint energy ventures with the Philippines in the disputed South China Sea, warning that unilateral action could cause problems and damage both sides.

Wang Yi, on a two-day visit to Manila, made the remarks after President Rodrigo Duterte on Monday said a partner had been found to develop oil fields and exploration and exploitation would restart this year.

Duterte did not identify the partner. The energy ministry on July 12 said drilling at the Reed Bank, suspended in 2014, might resume before year-end, and the government was preparing to offer new blocks to investors in bidding in December.

“In waters where there are overlapping maritime rights and interests, if one party goes for unilateral development, and the other party takes the same action, that might complicate the situation at sea,” Wang told a news conference.

“That might lead to tension, and as the end result, nobody would be able to develop resources.”

The Philippines suspended energy activities while awaiting a ruling in a case by the Permanent Court of Arbitration in the Hague. When it ruled a year ago, the court invalidated China’s claim to sovereignty over most of the South China Sea, through which more than $5 trillion of seaborne goods passes each year.

Beijing’s harassment of a survey ship of an Anglo-Filipino consortium in the Reed Bank in 2011 and its control of Scarborough Shoal in 2012 were among the reasons Manila filed the arbitration case, which China refuses to recognize.

China’s Foreign Minister Wang Yi speaks during a joint news conference with his Philippine counterpart Foreign Affairs secretary Alan Peter Cayetano (not pictured) in Taguig, Metro Manila Philippines July 25, 2017.Erik De Castro

The tribunal clarified Philippine sovereign rights to access offshore oil and gas its 200-mile Exclusive Economic Zone (EEZ), within which the Reed Bank is located.

The Philippines relies overwhelmingly on imports to fuel its fast-growing economy and needs to develop indigenous energy resources. Its main source of natural gas, the Malampaya field near the disputed waters, will be depleted within a decade.

Philippine Foreign Secretary Alan Peter Cayetano said the proposal to jointly develop resources in the disputed waters began in 1986, but the two countries “had not found wisdom to be able to push through to the next step”.

Philippine Foreign Affairs Secretary Alan Peter Cayetano (R) shakes…

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