Manila, Bei­jing work out how to tap oil, gas in South China Sea ar­eas they both claim

Business World - - FRONT PAGE - — Reuters with in­puts from Ar­jay L. Bal­in­bin

THE PHILIP­PINES and China have agreed to set up a spe­cial panel to work out how they can jointly ex­plore oil and gas in part of the South China Sea that both sides lay claim with­out hav­ing to ad­dress the ex­plo­sive is­sue of sovereignty.

China claims most of the South China Sea, where $ 3 bil­lion in sea-borne trade pass ev­ery year, and has com­pet­ing claims in var­i­ous parts of it with Brunei, Malaysia, Tai­wan, Viet­nam and the Philip­pines.

“It’s just the start of a process,” Philip­pine am­bas­sador to China, Jose San­ti­ago “Chito” L. Sta. Ro­mana, told re­porters late on Tues­day af­ter diplo­mats from both sides met for the se­cond time un­der a bi­lat­eral mech­a­nism aimed at de­fus­ing long-stand­ing mar­itime ten­sions.

He said the de­ci­sion to form a work­ing group on co­op­er­at­ing on en­ergy was a “break­through.”

Form­ing an agree­ment for a joint project would be ex­tremely com­plex and sen­si­tive as both coun­tries claim ju­ris­dic­tion of the site of the oil and gas re­serves, so shar­ing them could be deemed le­git­imiz­ing the other side’s claim, or even ced­ing sov­er­eign ter­ri­tory.

The idea of joint de­vel­op­ment was first hatched in 1986, but dis­putes and the sovereignty is­sue have stopped it from ma­te­ri­al­iz­ing.

But time is of the essence for the Philip­pines, which re­lies heav­ily on en­ergy im­ports to fuel its fast-grow­ing econ­omy. That is com­pli­cated by es­ti­mates that its only do­mes­tic nat­u­ral gas source, the off­shore Malam­paya field, will be de­pleted by 2024.

Mr. Sta. Ro­mana said a se­cond co­or­di­nat­ing group was formed to ad­dress sovereignty is­sues and “to pre­vent any cri­sis from es­ca­lat­ing.”

The Philip­pines in 2011 ac­cused Chi­nese ships of ha­rass­ing a sur­vey vessel hired by Fo­rum En­ergy Tech­nolo­gies, which won a con­tract to ex­plore oil and gas in the Reed Bank, near the Spratly.

The Philip­pines went the Per­ma­nent Court of Ar­bi­tra­tion in the Hague in 2013 to ques­tion that, among other bones of con­tention.

The tri­bunal’s 2016 rul­ing, which China re­fuses to rec­og­nize, in­cluded clar­i­fy­ing that the Reed Bank was within the 200 nau­ti­cal mile ex­clu­sive eco­nomic zone of the Philip­pines and there­fore it had sov­er­eign rights to ex­ploit re­sources there.

A se­nior Philip­pine of­fi­cial also said South­east Asian coun­tries

and China would next month start ne­go­ti­a­tions on a long- awaited mar­itime code of con­duct.

TROU­BLE AT BEN­HAM RISE

But the Philip­pines on Wed­nes­day said it would op­pose what it said were at­tempts by Bei­jing to as­sign Chi­nese names to un­der­sea fea­tures on part of Manila’s con­ti­nen­tal shelf on its Pa­cific Ocean coast.

“We ob­ject and do not rec­og­nize the Chi­nese names given to some un­der­sea fea­tures in the Philip­pine Rise,” Pres­i­den­tial Spokesper­son Her­minio Harry L. Roque, Jr. said in a me­dia brief­ing at Mala­cañan Palace, adding that the Philip­pine em­bassy in Bei­jing has al­ready raised the con­cern with the Chi­nese gov­ern­ment.

Mr. Roque said the is­sue would be raised with the In­ter­na­tional Hydrographic Or­ga­ni­za­tion that is re­spon­si­ble for as­sign­ing names to un­der­wa­ter fea­tures.

The area, which the United Na­tions des­ig­nated in 2012 as within Philip­pine ju­ris­dic­tion, is bet­ter known as Ben­ham Rise. It is roughly the size of Greece and be­lieved to be rich in bio­di­ver­sity and tuna.

Se­nate Sci­ence and Tech­nol­ogy com­mit­tee chair­man Se­na­tor Paolo Benigno A. Aquino IV said a pub­lic hear­ing on Feb. 26 will tackle this is­sue.

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