China’s oil rigs won't deter Vietnam's oil projects: official

By Trung Hieu, Thanh Nien News

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Mr. Ngo Thuong San, chairman of the Vietnam Petroleum Association and former director-general of Vietnam Oil and Gas Group (PetroVietnam). Photo: Trung Hieu

Mr. Ngo Thuong San, chairman of the Vietnam Petroleum Association and former general director of Vietnam Oil and Gas Group (PetroVietnam), confirmed to Thanh Nien that China’s illegal deployment of two oil rigs has not deterred foreign firms from executing their oil and gas exploration contracts with Vietnam.
Reporter: It has been more than two months since China deployed the Haiyang Shiyou-981 oil rig in Vietnamese waters. Recently China moved a second rig – the Nanhai 09 – into a disputed area with Vietnam. China appears determined to turn the East Sea (aka South China Sea) into its backyard ‘pond.’ What do you think?
Mr. San: In my opinion, the Haiyang Shiyou-981 failed to drill in the first 10 days of its [illegal] placement because it was positioned in the wrong location. It was later moved pretty far from the initial location and has been there ever since.
Normally it takes three months for a drilling rig to achieve something. The Vietnam National Oil and Gas Group (PetroVietnam) has explored the area where China placed the rig and detected some deep-water spots with potential oil reserves.
According to the maritime map, the sea in this area is more than 1,500 meters deep. Given the depth and the remoteness from any onshore base, the oil exploration effects won't yield any significant results. That's why PetroVietnam hasn't focused on drilling in the area.
What's more, the weather in this area is unpredictable and sees a lot of severe storms.
Recently, China had to lower the oil rig by 3-4 meters, for safety reasons, after a slight tropical depression occurred in the area.
As for the second rig, China has moved it into the Gulf of Tonkin in the waters not yet delimited by Vietnam and China. According to international law, no party is entitled to conduct unilateral oil and gas exploration and extraction activities in the overlapping areas that have yet to be delimited.
In your opinion, what is the political and economic importance of the area where China placed the second oil rig?
The area is of economic significance because it has a great deal of oil and gas potential. Vietnam has explored sites near the area and found oil there.
There are some oil reserves which lie across the delimitation line that require more joint research and exploration activities by both countries before they can be exploited. But above all, both sides must reach consensus and respect each other’s sovereignty and economic interests.
What is the difference between the Nanhai 09 and the Haiyang Shiyou-981?
They are similar in terms of structure. As far as I know, China bought the Nanhai 09 from a European country and re-assembled it, while the Haiyang Shiyou-981 is locally-made.
I think the Haiyang Shiyou-981 carries both an economic and political significance, as China wants to test the reaction of both Vietnam and the world to the "U-shape line" claim to nearly all the islands in the South China Sea.
Meanwhile, the primary motive for the deployment of the Nanhai 09 is economic. But as I've already said, China is not allowed to conduct unilateral oil and gas exploration and extraction activities in disputed waters.
Many foreign experts have said that Vietnam's best option is to take China to an international court and force it to comply with international law and convention on the South China Sea. What do you think?
I think the Politburo is still weighing the timing and evidence for such a lawsuit. It is really important for Vietnam to make thorough preparations before filing such a suit; we must be sure we will win.
Vietnam should try to gain international support by explaining China’s defiance of international law to the world. If Vietnam brings China to an international court, I think we must make it clear that we have sued China not only because it violated our sovereignty but also because of China’s illegal U-shape claim negatively affects other countries such as Malaysia, Indonesia and the Philippines and undermines global maritime security.
Vietnam should make other countries understand that their interests in the South China Sea are threatened by China’s actions.
Has China’s deployment of oil rigs in the South China Sea affected Vietnam’s economy as a whole and oil and gas exploration activities in particular? Are foreign partners who signed oil and gas agreements with Vietnam concerned about the rigs?
PetroVietnam has signed agreements with ExxonMobil, Gazprom and Murphy Oil Corporation to explore and extract oil from fields in Vietnam’s exclusive economic zone and continental shelf.
The foreign partners are implementing the projects as planned. They're more concerned with the economic effectiveness of the projects rather than China’s political threats.
I think they studied international law and regulations in the South China Sea thoroughly before signing their agreements with Vietnam--these companies have very competent legal consultants.
Vietnam is also working to improve legal conditions for foreign companies to boost oil and gas exploration and exploitation in Vietnamese waters.

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