Thursday, June 19, 2014

Another China Drilling Rig Moves South

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While Chinese envoy chats up Hanoi’s leaders, more provocation looms
China's former Foreign Minister was in Hanoi on June 18, the first high level talks since Beijing deployed the deepsea rig Haiyang Shihua 981 (HY 981) in early May to explore for oil and gas in a promising patch in Vietnam's exclusive economic zone.

Almost surely not a coincidence, news services reported the same day a mariners' warning sourced to the Hainan branch of China's Marine Security Agency to the effect that tugs are towing another deepsea drilling rig south, parallel to Vietnam's central coast. The Nanhai Jiuhao was acquired late last year by a subsidiary of the China National Offshore Oil Company (CNOOC) from the Switzerland-based multinational deepsea drilling giant Transocean Ltd. According to the industry website, the semi-submersible rig can drill in waters up to 1500 meters' depth and penetrate some 15,000 meters into the seabed.

The Chinese emissary, Yang Jiechi, is the same official who famously lost his cool at an Asean meeting some years back and reminded his counterparts that "China is a big country, and yours are small countries, and that's a fact." Yang has now been recycled as a State Councilor, and also co-chairs the annual meetings of the Steering Committee for Sino-Vietnamese Cooperation. The Hanoi regime has been trying for weeks to persuade Beijing to discuss the HY 981 affair. Beijing said it is willing, but only if Hanoi acknowledges China's sovereignty over the waters where HY 981 and its flotilla of escort boats have deployed. The long-scheduled bilateral meeting offered a way around the impasse.

It did not begin auspiciously. At the end of the day on June 18, there was no statement from the Vietnamese side, but at the ritual photo op, the best Vietnamese Deputy Prime Minister Pham Binh Minh could muster was a cold-eyed stare. A Chinese spokesman said Yang in his meeting with Minh and a follow-on with Prime Minister Nguyen Tan Dung told the two that Vietnam "must cease interfering with China's [drilling] activities and exaggerating related matters."

What the top officials said in private can only be guessed. The meetings offered an opportunity for Yang to dissuade Dung and Minh from much-discussed plans to lodge a complaint against China at the Law of the Sea Tribunal, and (separately) for Vietnamese Communist Party Chief Nguyen Phu Trong to impress on Yang that China's brazen aggression has severely undercut the position of Beijing's remaining friends in Hanoi.

Meanwhile, the new drilling rig is moving south at 4 knots per hour, a pace that should bring it to the vicinity of the HY 981 in about three days. That's the Nanhai Jiuhao's probable destination, but it conceivably might just keep going, heading southeast across the South China Sea for the Reed Bank.

The deep waters off Vietnam where HY 981 has been drilling and where, closer inshore, Exxon Mobil has made some encouraging finds, are above the so-called Phu Khanh formation. Phu Khanh is considered the second most promising place in the South China Sea to look for new pools of oil or gas. The most promising, hands down, is the Reed Bank, a table mount in relatively shallow waters between the Philippines and the dozens of reefs and islets that constitute the Spratly Islands. Manila has authorized a Philippine company, Philex Petroleum, to begin test drilling in the Reed Bank in 2015.

That's just the sort of "provocation" that Beijing might be in a hurry to forestall.

David Brown is a retired US diplomat with wide experience in Southeast Asia, particularly Vietnam


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