Sunday, May 11, 2014

Escalating Tension Over Energy Recovery Worries Ocean Freight Shipping Community

Age Old Territorial Disputes Ramped Up as Fuel Resources Dwindle
Shipping News Feature

SOUTH CHINA SEA – ASIA – EUROPE – UK – Two years ago or more we expressed concern over the unstable relations between the governments of the People’s Republic of China, the Republic of China (Taiwan), Vietnam, the Philippines, Malaysia and Brunei over the ownership of the Spratly Islands and areas of the South China Sea in which they lay. Now the latest move by China to establish energy recovery rights in the region have met with a rebuke from the international community. These disputes are of particular interest to the ocean freight shipping community as the area is on the key trade routes between Eastern China and the main South East Asian markets such as Singapore, Malaysia and Thailand.

A flurry of distinctly undiplomatic language has raged recently after China moved its largest oil rig into the disputed area reportedly less than 200 kilometres from the Vietnamese coast. The resultant protests in Vietnam mirrored the emotions of the country’s April rally which remembered the 64 sailors who died in the 1988 Spratly Archipelago incident and the 1974 ‘Battle of the Hoang Sa (Paracel) Islands’.

Earlier in the month a military exercise by Taiwanese amphibious troops on the Spratly island of Taiping (Itu Aba) seemingly angered the Chinese and this week the Vietnamese reported two of their coastguard ships in the area had been deliberately rammed and badly damaged by Chinese vessels with several others suffering ‘minor damage’ and some slight casualties. The presence of the huge rig, owned by China's state-run oil company, CNOOC, has exacerbated the situation causing the US to call for the situation to be resolved by way of international law.

According to local reports from several of the countries involved in the ongoing row over possession of the seven hundred strong Spratly island chain and the surrounding seas, China has deployed up to eighty ships, including several military vessels, in support of the giant semi-submersible rig, with water cannon fired between the combatants on several occasions. A statement by the EU said:

“We are concerned about recent incidents involving China and Vietnam relating to the movements of the Chinese oil rig HD981. In particular, the EU is concerned that unilateral actions could affect the security environment in the region, as evidenced by reports about the recent collision of Vietnamese and Chinese vessels.

“We urge all parties concerned to seek peaceful and cooperative solutions in accordance with international law, in particular the UN Convention on the Law of the Sea, and to continue ensuring safety and freedom of navigation. We also call on the parties to undertake de‐escalating measures and refrain from any unilateral action which would be detrimental to peace and stability in the region. The EU will keep following these developments closely. “

The EU position was reiterated by UK Foreign Office Minister Hugo Swire, who said:

“The installation of a Chinese oil rig in disputed waters this week has led to increased tensions in the South China Sea. The UK supports the EU statement issued on 8 May, and has raised the issue with the Chinese government at Ministerial level. We urge all parties to exercise restraint and seek to de-escalate the situation.”