Explorations of a gas field in the East China Sea by both China and Japan have strained relations between these two superpowers. The dispute only highlights the level of tension between Taiwan, Japan and China over their overlapping exclusive economic zones (EEZs), fishing rights, oil and natural gas resources. For the time being, there is no permanent solution to resolve the conflict that currently looms in the East China Sea.
Last year, to temporarily put aside the dispute, Beijing came up with a proposal to jointly develop natural gas fields in the region with Japan. However, Tokyo did not react enthusiastically, for it had only intended to explore for oil in the EEZ that it deems belongs to Japan. With regard to the progress made in the exploration of oil fields in the disputed region, Japan is actually trailing behind China. Thus, further disputes are to be expected if China begins petroleum production in the next two months in the area within China's EEZ, 5km from the center line between each country's coast.
In contrast, the situation in the South China Sea seems calmer, as there was a substantial change in the dispute over the Spratly Islands. Petroleum companies from three countries -- China, Vietnam and the Philippines -- including China National Offshore Oil Corp (CNOOC), Vietnam Oil and Gas Corp and Philippine Oil Co, signed a joint exploration agreement to probe for oil in the Spratly Islands and agreed to conduct a seismic survey program in the region over the course of three years.
In addition to these three countries, there are another three countries involved in the dispute over the Spratly Islands: Malaysia, Brunei and Taiwan. However as only three countries participated in the negotiations, this indicates a strategy to achieve a partial resolution to the dispute. Because of such strategic concerns, the content of the contract has yet to be made public and only the three nations are engaged in the cooperation project.
On the day of the signing of the agreement, China, Vietnam and the Philippines made a brief statement, only mentioning that the petroleum survey would cover an area of about 143,000km2, but not specifying the precise location. The furtive manner of the announcement has sparked suspicion, causing the rest of the nations involved to wonder about the real scope of cooperation.
In the statement, the three signatories affirmed they would abide by the 1982 UN Convention of the Law of the Sea and the 2002 ASEAN-China Declaration on the Conduct of Parties in the South China Sea. Clearly, the three nations are resolved to transform the South China Sea into a peaceful, stable and cooperative region, and agree not to challenge the basic positions of the other signatories regarding the disputed area in the South China Sea. Additionally, these nations would also, according to the principle of equality, proceed with the research project and establish a committee to negotiate issues related to the exploration, with each nation sharing the expenditure for the survey. The budget for the first phase will be US$15 million.
Although the content of the agreement has yet to be made public, we can still speculate over the range of the cooperation from a remark by Philippine President Gloria Macapagal Arroyo that "if oil reserves were discovered outside the municipal waters of Kalayaan in the Spratlys, the national government would have exclusive rights to its revenue earnings. The so-called Kalayaan Islands are the part of the Spratlys claimed by the Philippines.
Judging from Arroyo's remark, the scope of the survey would probably include two parts. One is within the Kalayaan Islands while the other is beyond the range of the Kalayaan Islands.
In 1992, China formed a collaboration with Denver-based Crestone Energy to explore the Wan'an North-21 block in the southwest of the Spratlys, only to learn that Vietnam had given an overlapping contract to ConocoPhilips. The agreement allowed Crestone Energy Corp to conduct a drilling and a seismic study at depths of 300m to 700m below sea level. Part of "WanAn North-21" overlapped Vietnam's No. 133 and No. 134 mining sites. Thus, Vietnam protested against China's decision to recruit energy companies to explore the "Wan'An North-21" and coaxed Crestone Energy into giving up the site by offering it a mining area in Vietnam in return. Very probably because of lobbying by Vietnam, Crestone Energy eventually failed to complete the survey. Nevertheless, China extended its contract with Crestone in 1999. What is suspicious is that if China does not make concessions, it will be impossible for it to convince Vietnam to take part in the joint investigation. Therefore, China might propose including part of the Wan'an North-21 in the joint survey.
Although Taiwan still claims sovereignty over the Spratlys, it was not invited to participate in the 2002 ASEAN-China Declaration on the Conduct of Parties in the South China Sea. Additionally, when signing the agreement, China, Vietnam and the Philippines did not inform Taiwan of their intentions to jointly conduct a survey. Nor did these three countries reveal the coordinates of the location of the survey. This furtive action has already violated the UN Convention on the Law of the Sea and the principle of transparency.
In view of this, the government should seek to ask these three countries to make public the details of the agreement they have signed.
Chen Hurng-yu is the professor of history at National Chengchi University.
TRANSLATED BY DANIEL CHENG
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