Vietnam Makes Bold Move For Oil In Disputed South China Sea

Vietnam Makes Bold Move For Oil In Disputed South China Sea

Vietnam has allowed a drillship in a contested part of the South China Sea,
according to an industry consultant who spoke to the BBC.

The drillship, Deepsea Metro I, on contract to Talisman-Vietnam, a unit of
Talisman Energy-which Spanish Repsol bought back in 2015-is drilling about
250 miles from the Vietnamese coast.

The move is a bold one, because the block where Deepsea Metro I is
drilling-called Block 136-03 by Vietnam and Wan-an Bei 21 by China-has
already been leased to a company by Beijing - Hong Kong-based Brightoil,
which has close ties to the Chinese government. Over the last three years,
Hanoi denied Talisman-Vietnam a license to drill in the block in a bid to
avoid antagonizing China, but it seems things have since changed.

The report about the start of drilling comes soon after last week, a senior
Chinese military official cut short a visit to Vietnam. Fan Changlong,
vice-chairman of China's Central Military Commission, was visiting Vietnam
for a "defense border meeting," as China's Xinhua agency reported at the
time, but left early because of "working arrangements."

The true reason for the departure, the BBC suggests, may have been news
about what Deepsea Metro I is doing in the disputed area.

Last year, China lost an international arbitration case brought to the court
by its neighbors, including Vietnam. Asia's second-largest economy is
claiming most of the South China Sea, building artificial islands and
increasing its military presence there.

Earlier this year, China warned the U.S. to stay out of the disputed waters,
although this tension has recently subsided as both countries continue to
focus on the North Korea problem.

The South China Sea may hold 28 billion barrels of oil, according to an
estimate from the U.S. Geological Survey from the mid-90s. With technology
improvements, this figure could have since increased substantially. Vietnam
has welcomed several foreign companies into its oil and gas industry,
including Rosneft, and Gazprom, as well as Exxon.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Link to Original Article:
http://oilprice.com/Latest-Energy-News/World-News/Vietnam-Makes-Bold-Move-Fo
r-Oil-In-Disputed-South-China-Sea.html

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com