China-US Energy Geopolitics: The Battle for Oil in the South China Sea

Global Research
Michel Chossudovsky

A new area of potential confrontation is developing between China and the U.S. According to reports, Exxon Mobil which has acquired exploration and production rights from Vietnam has discovered substantial gas reserves in the South China Sea  off the coast of North Vietnam.

"U.S. oil company ExxonMobil is reporting a "potentially significant" gas discovery off the coast of Vietnam, stating in a press release, "We can confirm ExxonMobil Exploration and Production Vietnam Limited drilled its second exploration well offshore Danang in August 2011 and encountered hydrocarbons." (See John C.K. Daly, Apocalypse Redux? U.S. Natural Gas Find off Vietnam Could Raise Tensions with China,  http://oilprice.com )

It is important to note that  these off-shore reserves are located between the North Vietnam coastline and China's Hainan island in an area of disputed jurisdiction between Vietnam and China. (see map above) The contested area is made up of blocks 117, 118 and 119, which according to Hanoi fall  within the 200-mile exclusive economic zone under international maritime law (Ibid)

On October 31, following the ExxonMobil discovery announcement, China responded by warning foreign companies not to meddle  "in areas also claimed by China." ( China again warns foreign oil firms on South China Sea exploration | Reuters, October 31, 2011)

"We hope foreign companies do not get involved in disputed waters for oil and gas exploration and development. This position has been consistent," Hong said, when asked whether China plans to ask Exxon Mobil to withdraw from its oil and gas deal with Vietnam.

Environmental activists occupy Arctic oil rig

The Independent

Cairn Offshore Drilling

Greenpeace activists climbed aboard an oil rig off Turkey today in a bid to prevent it from leaving for Greenland to begin deep-water drilling in the Arctic. 

Eleven activists in rock-climbing gear used speedboats to intercept and then climb on to the Leiv Eiriksson after it had left a port in Istanbul. 

They climbed the rig's derrick, unfurling a banner that read: "Stop Arctic destruction" and "Go Beyond Oil, Choose Clean Energy". 

The platform, bound for Greenland's Baffin Bay, did not stop and was continuing on its course, heading towards the Dardanelles strait with the activists on board, Deniz Sozudogru, a Greenpeace spokeswoman for the Mediterranean region, said. 

There were no Turkish coastguard boats trailing the oil rig, she said. The Dardanelles connects the Sea of Marmara to the Aegean sea. 

Activists from Britain, Denmark, Canada, Poland, Germany, Slovakia, Austria, Sweden and Turkey were prepared to occupy the rig for days, according to the group. 

It said the oil rig, operated by Scottish company Cairn Energy, has "a very short window in which to drill their four new exploratory wells" due to extreme weather conditions in the Arctic.

Cairn Energy confirmed an "incident" involving Greenpeace off Turkey's coast and said the vessel was continuing "in transit to take part in Cairn's 2011 exploration programme in Greenland." 

The company said it was operating at the invitation of Greenland's government and had successfully drilled three wells there in 2010. 

Officials added: "Wherever it is active, Cairn seeks to operate in a safe and prudent manner. Cairn respects the rights of individuals and organisations to express their views in a safe manner."

Greenpeace wants Cairn to suspend deep-water drilling after the spill in the Gulf of Mexico.

"Freezing temperatures, severe weather and a highly-remote location pose unprecedented challenges to any oil spill response in the Arctic and mean a spill could be impossible to contain and clean up," Greenpeace said. 

Leiv Eiriksson, one of the world's largest rigs, had been exploring possible oil and gas in the Black Sea under a joint venture between Turkey and Brazil's Petrobas.