Plans in the Philippines to reopen a tract of the disputed South China Sea for oil and gas exploration are likely to complicate the foreign policy of Manila’s new friend Beijing, which claims the same waters, and adds to a regional pushback against Chinese maritime influence.
Philippines oil drilling plans
The Philippine Department of Energy is ready to restart drilling at Reed Bank, an 8,866 square-kilometer table mount west of Palawan Island, domestic news reports say. In December 2014 the government suspended those plans to prepare for world court arbitration over which country had a stronger claim to the feature.
That court in The Hague ruled that Reed Bank falls within a Philippine ocean exclusive economic zone. China rejected the outcome and in May warned Philippine President Rodrigo Duterte against reopening it for exploration, Philippine media reports say. China claims more than 90 percent of the sea.
“You had Duterte saying he spoke to (Chinese President) Xi Jinping in May and China threatened to take action if they started drilling,” said Carl Thayer, Southeast Asia-specialized emeritus professor at The University of New South Wales in Australia. “It’s a sensitive time. July 12 was the anniversary of the arbitral tribunal decision.”
Ismael Ocampo, director with the Department of Energy's Resource Development Bureau, said this month he expected the country to lift the drilling suspension by December, per news reports from Manila. The department did not answer a VOA request for comment.
China with a ‘wait and see’ strategy
Chinese officials have kept quiet about Reed Bank this month, though on July 12 a foreign ministry spokesman in Beijing said China was “dedicated from start to finish to negotiating with related countries to resolve disputes” related to maritime sovereignty.
The Philippines may be using Reed Bank to see how far it can push China, said Fabrizio Bozzato, a Taiwan Strategy Research Association fellow specialized in Asian political issues.
“Probably Mr. Ocampo’s statement is a way that Manila has to test China’s resolve or restraint or even to elicit some cooperative stance from China without risking to irritate or antagonize Beijing,” Bozzato said.
China might answer any drilling at Reed Bank by withholding aid or investment as promised or allocated to date, Bozzato said, hurting Duterte’s ambition for economic development. Chinese officials could restart any suspended aid if relations improved.
China had pledged billions in aid
China pledged $24 billion for the Philippines in October, and Duterte’s government set aside the maritime sovereignty dispute with China, which claims waters off most of his archipelago’s west coasts. Duterte is tapping China now to help fund parts of a $167 billion plan for new public infrastructure by 2022. His predecessor, in contrast, had filed for the world court arbitration.
A strained friendship with Beijing would push Manila back toward Washington. Duterte has resisted U.S. military aid in his 13 months in office so far, delighting China.
Brunei, Malaysia, Taiwan and Vietnam as well claim parts of the 3.5-million-square-kilometer South China Sea, prized largely for its oil and gas reserves.
Beijing officials are probably taking a long view of ties with Duterte, who they see as more volatile than other world leaders, so they may cut him slack, experts said in April after another flap involving China.
Fewer than half of Filipinos surveyed in the first quarter of 2017 trust China, research institution Social Weather Stations found, and analysts say Duterte must bear that in mind as an elected official.
Other countries testing China
China may also see a trend of resistance developing beyond Reed Bank, experts say. They point to Vietnam’s agreement this month with India’s offshore oil and gas driller to explore in a tract that Beijing claims and to Indonesia’s deletion of the word “China” from its official name of the sea near the island of Borneo.
“I think the worst case scenario is that the Southeast Asians (are) divided, look over their shoulder and one by one start making their accommodations to China,” said Euan Graham, international security director with the Lowy Institute for International Policy in Sydney.
“We’re not seeing it when it comes to these key countries,” he said. “Indonesia, the Philippines…certainly the Vietnamese are continuing I think their sort of steady push to try to assert control.”