RP, China approve joint oil exploration in Spratlys

BEIJING (via PLDT) – The Philippines and China have agreed to undertake joint oil explorations in the disputed Spratly group of islands in the South China Sea.

The oil exploration venture was one of two major agreements signed by both countries yesterday that highlighted the three-day state visit of President Arroyo here.

The two countries have agreed to conduct a three-year oil exploration research around the waters in the Spratlys and a separate agreement on fishery cooperation to prevent poaching incidents among Chinese and Filipino fishermen in the area.

Mrs. Arroyo and Chinese President Hu Jintiao witnessed the signing of two of the five memorandum of Understanding (MOU) at the end of their one hour closed- door bilateral meeting at the Great Hall of the People here.

The first MOU was on the Joint Marine Seismic Undertaking between the state-owned Philippine National Oil Company (PNOC) signed by its new president Ed Mañalac with Fu Chiang You, president of the China National Offshore Oil Company.

Energy DOE Secretary Vicente Perez said the MOU will focus on pre-exploration research study on the Spratlys. This does not mean both countries will give up their respective territorial claims in the area, he said.

"This agreement between the two oil companies is by no means imply that we are waiving any rights or claims to South China Sea. It is merely an undertaking to study, research and find out petroleum potential there," Perez said.

"It is a three-year study to collect, process and analyze seismic data on certain areas of the South China Sea as part of the energy independence package of (the) President to promote our own indigenous oil and gas resources," he added.

Perez said the two oil companies agreed to share data and costs of operation.

Perez estimated the pre-exploration will cost $7 million to determine the presence of oil and gas reserves in the disputed area.

He also said the oil exploration agreement can be seen as "a diplomatic breakthrough" from the point of view of the Philippine and Chinese government.

"Because it (agreement) is the first concrete manifestation of the Asean-China Declaration of Conduct for the South China Sea," Perez said.

Perez recalled the declaration was signed in Phnom Penh in November 2002 will all the six countries –including the Philippines and China – laying claim on the Spratlys. — With Marianne Go