Apocalypse Redux? U.S. Natural Gas Find off Vietnam Could Raise Tensions with China

[RegieRocker]

First, the good news…

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."

ExxonMobil is the world's largest publicly traded oil company by market value. While Vietnam, an oil exporter and the third-largest oil producer in South Asia, began offshore exploration of its reserves in the 1970s, Hanoi only started in 2004 awarding offshore exploration concessions to a plethora of foreign companies, including those from the U.S., Canada and India with ExxonMobil receiving concessions from the Vietnamese government allowing it to explore blocks 117, 118 and 119 off Danang, an area that Vietnam insists is well within its 200-mile exclusive economic zone under international maritime law.

The bad news?

The South China Sea’s offshore resources are currently claimed by six countries – China, Vietnam, Taiwan, Malaysia, Brunei and the Philippines, with competing claims overlapping in a crazy quilt pattern. Given the billions of dollars at stake for exploiting the undersea energy resources, it is unlikely that the contradictory claims will be resolved anytime soon, making Southeast Asian waters a potential flash point for conflict.

The devil is in the details and in this case the United Nations unwittingly played the role of Lucifer when in 1982, the United Nations Convention on the Law of the Sea Part V, Article 55 defined an “exclusive economic zone” (EEZ) for countries with maritime frontiers as extending 200 nautical miles from a nation’s coastline. Needless to say, in congested waters this clause was a subject of dispute, as nations raced to define their new offshore parameters, a contest only heightened by the world’s increasing addiction to hydrocarbons.

Like Pontius Pilate, the UN washed its hands of bilateral and regional disputes arising from the convention and devolved negotiations to the parties involved, which account for the current impasse in the South China Sea, as the 1982 UNCLOS agreement did not establish any adjudication mechanism for resolving disputes.


read more..

http://oilprice.com/Energy/Natural-Gas/Apocalypse-Redux-U.S.-Natural-Gas-Find-off-Vietnam-Could-Raise-Tensions-with-China.html

[Kaleva]

1. Vietnam has been acquiring modern warships to upgrade its navy.

"The Vietnam People's Navy received in March and August 2011 two Gepard 3.9 class frigates originally ordered in 2006. They were built in Russia at Tatarstan's Gorky Shipbuilding Plant. Vietnam is currently examining a purchase of two more with the possibility that they will be built in Vietnam under license."

http://en.wikipedia.org/wiki/Gepard_class_frigate