October 31, 2011 / 10:39 AM / 9 years ago

China again warns foreign oil firms on South China Sea exploration

BEIJING (Reuters) - China on Monday warned foreign energy companies against exploration in the disputed South China Sea after U.S. oil giant Exxon Mobil Corp said it had discovered hydrocarbons in August off central Vietnam, in an area also claimed by China.

The potentially significant gas discovery was made off the coast of Danang city, bringing a territorial row over the resource-rich South China Sea back into focus.

Chinese Foreign Ministry spokesman Hong Lei reiterated at a regular briefing that “China has indisputable sovereignty over the Spratly Islands and adjacent waters,” referring to the South China Sea.

“We hope foreign companies do not get involved in disputed waters for oil and gas exploration and development. This position has been consistent,” Hong said, when asked whether China plans to ask Exxon Mobil to withdraw from its oil and gas deal with Vietnam.

He did not elaborate, nor single out Exxon Mobil by name.

Exxon Mobil has a licence from the Vietnamese government to explore blocks 117, 118 and 119 off the Danang coast, falling within what Vietnam claims is its 200-mile exclusive economic zone under international maritime law, the Financial Times reported last week.

But the blocks also fall within China’s vast claim to almost the entire South China Sea, also claimed in part by Brunei, Malaysia, the Philippines and Taiwan.

The sea and areas such as the Spratly Islands and other atolls are believed to have rich deposits of oil and gas and is also a rich fishing ground.

One of China’s most popular newspapers, the Global Times, cautioned last week that nations involved in territorial disputes in the waters should “mentally prepare for the sounds of cannons” if they remain at loggerheads with Beijing.

(Reporting by Sui-Lee Wee; Editing by Ed Lane)

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