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View Full Version : U.S. criticizes Chinese oil rig move



Judge
08-05-2014, 10:15
This is worth a thread of its own...



Originally Posted by Russian Lad View Post
China are not on a direct collision course with the Western world.


It's incidents like this that could bring them on course...




(Reuters) - The United States on Tuesday sharply criticized the movement of a huge Chinese oil rig that Vietnam says has entered its waters, the latest show of Beijing's growing assertiveness to raise alarm among smaller countries in the region.

The Vietnamese accusation came days after U.S. President Barack Obama visited Asia to underline his commitment to allies there, including Japan and the Philippines who are themselves locked in territorial disputes with China.

Obama, promoting a strategic "pivot" toward the Asia-Pacific region, also visited South Korea and Malaysia, but not China.

Vietnam has condemned the operation of the deepwater drilling rig in what it says are its waters in the South China Sea, and told China's state-run oil company to remove it.

In Washington, U.S. State Department spokeswoman Jen Psaki told reporters: "Given the recent history of tensions in the South China Sea, China's decision to operate its oil rig in disputed waters is provocative and unhelpful to the maintenance of peace and stability in the region."

"These events point to the need for claimants to clarify their claims in accordance with international law, and reach an agreement ... about what types of activities should be permissible within disputed areas," she added.

Vietnam also protested the move.

"Vietnam cannot accept this, and resolutely protests this action by China," the foreign ministry said on its website, summarizing comments by Foreign Minister and Deputy Prime Minister Pham Binh Minh, who spoke to his Chinese counterpart by telephone on Tuesday.

"We request China pulls out the ... rig and all vessels from this area ... Vietnam will take all suitable and necessary measures to protect our legitimate rights and interests."

A ministry official said the two countries had been in direct talks about the issue since Sunday, but did not say how China had responded to Vietnam's requests. China has said the rig was operating completely within its waters.

Daniel Russel, Assistant U.S. Secretary of State for East Asian and Pacific Affairs, said the United States was looking into the matter, but urged caution from all sides.

"We believe that it is critically important for each of the claimant countries to exercise care and restraint," he told Reuters during a visit to Hong Kong ahead of a previously scheduled trip to Hanoi on Wednesday.

"The global economy is too fragile and regional stability is too important to be put at risk over short term economic advantage."

China claims almost the entire oil- and gas-rich South China Sea, rejecting rival claims to parts of it from Vietnam, the Philippines, Taiwan, Malaysia and Brunei. It also has a separate maritime dispute with Japan.

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Its claims coincide with growing diplomatic and military influence in the region and have raised fears of possible conflict.

The Maritime Safety Administration of China (MSAC) announced on its website on Saturday that all vessels should keep one mile away from the rig, called the Haiyang Shiyou 981. It expanded that to three miles on Monday.

The $1 billion rig is owned by China's state-run CNOOC oil company and it had been drilling south of Hong Kong.

On Sunday, Vietnam said the coordinates of the rig put it in Vietnam's exclusive economic zone and on its continental shelf, about 120 nautical miles off its coast.

But, like other Asian nations involved in territorial disputes with China, Vietnam appears to have limited options when dealing with the emerging superpower.

The Philippines said last month that the United States had a treaty obligation to help in case of an attack on its territory or armed forces in the South China Sea, although Obama did not say categorically that Washington would do so.

In 1992, Vietnam sent naval vessels into an area where China signed a contract with a U.S. firm to develop oil and natural gas in what it said were its waters.

"From 1992 until now, I haven't seen any action from Vietnam stronger than that," said a Vietnamese academic who specializes in South China Sea affairs.

"My guess is either this action from China is to send a message to the United States after Obama's Asia visit, or to direct the community to this topic to distract them from the terror in Xinjiang."

China's nervousness about Islamist militancy has grown since a car burst into flames on the edge of Beijing's Tiananmen Square in October and 29 people were stabbed to death in March in the southwestern city of Kunming.

The government blamed militants from the far-western region of Xinjiang for both attacks.

China routinely sends patrols into the South China Sea, mostly involving the coast guard and civilian maritime protection force rather than the navy.

But the positioning of such a large structure in disputed waters was seen by some analysts as a significant escalation in the dispute.

Singapore-based South China Sea expert Ian Storey said the rig movement risked a "potentially very dangerous scenario."

"There have been standoffs with survey ships in the past, but this is something new," said Storey of the Institute of South East Asian Studies.

"There's been a great deal of speculation about how China would use this expensive new rig and it seems we now have the answer. It puts Vietnam in a very difficult position."

"They will have to respond to a challenge to their sovereignty, and when they do, China will be sure to make a counter move, so we are in a situation where a potentially very dangerous scenario could unfold."

China's Global Times, an influential tabloid published by the ruling Communist Party's official People's Daily, wrote in an editorial on Tuesday that China should show a "firm attitude" towards Vietnam.

"China follows a moderate policy. But no country can always show a smiling face to the world. China shouldn't be angered easily, but if its interests are infringed upon, a strong retaliatory move should be expected," it said.


http://www.reuters.com/article/2014/05/06/us-china-vietnam-usa-idUSBREA450WL20140506

Judge
19-05-2014, 20:42
tick tock tick tock...


This would turn uglier if lets say it was China vs S.Korea/Japan cos help might come there way,with Vietnam, they don't have many powerful friends in that region...






China evacuates over 3,000 citizens from Vietnam
China sends aeroplanes and ships to pull its nationals out of Vietnam after deadly anti-Chinese protests across the country

http://www.telegraph.co.uk/news/worldnews/asia/china/10839036/China-evacuates-over-3000-citizens-from-Vietnam.html

Judge
19-05-2014, 20:43
This bit of news caught my eye the other day...



Japanese prime minister opens the way to send his soldiers on foreign missions after seven decades of pacifism



http://www.dailymail.co.uk/news/article-2628931/Japanese-panel-urges-greater-military-role.html

Russian Lad
19-05-2014, 21:24
It's incidents like this that could bring them on course...

It surely can, but even if they are, how is Russia going to gain from it? It is not like we are dear friends with China either. We tried to be friends once, it ended in a little war. The Chinese are way less predictable than the West, they surely will want to protect their citizens in Siberia if given a chance.

Judge
20-05-2014, 12:31
It surely can, but even if they are, how is Russia going to gain from it? It is not like we are dear friends with China either. We tried to be friends once, it ended in a little war. The Chinese are way less predictable than the West, they surely will want to protect their citizens in Siberia if given a chance.


Nothing to gain, just stand back and watch and support China in the same way China supports Russia over Crimea(not say much)....
In todays modern word, past little conflicts are easily forgotten..

okiey
20-05-2014, 12:40
It surely can, but even if they are, how is Russia going to gain from it? It is not like we are dear friends with China either. We tried to be friends once, it ended in a little war. The Chinese are way less predictable than the West, they surely will want to protect their citizens in Siberia if given a chance.

Are we going to see a mass Siberian evacuation as in Vietnam?)

Judge
20-05-2014, 12:44
Are we going to see a mass Siberian evacuation as in Vietnam?)

I think we will see mass chinese invesment in Siberia..


A little googling brings up this story...

The New Silk Road

http://siberiantimes.com/business/casestudy/news/new-chinese-plan-sees-a-rail-link-via-siberia-from-beijing-railway-to-the-us-and-canadaat-bullet-speed/

Judge
20-05-2014, 12:56
I wonder if the US will say it's disappointed with China because they are about to invest and sign massive gas deals with Russia........ Like the US did with little Bahrain the other week..

Russian Lad
20-05-2014, 15:30
I wonder if the US will say it's disappointed with China because they are about to invest and sign massive gas deals with Russia.

Many gas professionals say it is nothing but a political deal, and Gazprom may even sustain losses on it if the price is too low. This deal has been discussed for at least ten years now. China has all the gas it needs, it may take on the Russian gas to its Northern regions only if it is cheaper than from other sources. Russia will need to invest billions into the supplying infrastructure. So, the US will not be disappointed even if they claim otherwise.

okiey
20-05-2014, 15:48
The main thing that held back the deal was Russia trying to squeeze European gas prices out of China. Europe gas prices average $380/1,000 cum, the deal with China may be struck at $330-350/cum, which is viable on a long-term contract. Chinese will probably help with financing.

At the end of the day its a hedge against Western sanctions and will keep the engine of Russia's economy oiled.



Many gas professionals say it is nothing but a political deal, and Gazprom may even sustain losses on it if the price is too low. This deal has been discussed for at least ten years now. China has all the gas it needs, it may take on the Russian gas to its Northern reagions only if it is cheaper than from other sources. Russia will need to invest billions into the supplying infrastructure. So, the US will not be disappointed even if they claim otherwise.

Russian Lad
20-05-2014, 16:03
At the end of the day its a hedge against Western sanctions and will keep the engine of Russia's economy oiled.

If it is a zero profit or small profit margin contract I don't see any hedging. Besides, the gas that goes to Europe goes from different areas. Besides, I am 100% sure the Chinese will try to squeeze Gazprom dry, they have never struck me as benefactors. But the local Ivans will swallow this as a great success I guess. Till the sanctions wave hits their uneducated brains and livelihoods within a year. Macroeconomics never have immediate effects, it takes time. But not a lot of time.

Russian Lad
21-05-2014, 12:03
The Chinese have cancelled the gas deal signing, they seem to be quite happy with their 300 dollars gas from Turkmenistan. Atrium, the largest European real estate developer, has cancelled all its projects in Russia. :watching:

okiey
21-05-2014, 13:41
Breaking news on Bloomberg: CNPC and Gazprom sign deal. More to follow.

Russian Lad
21-05-2014, 13:54
Yes, have heard about it too. What is so breaking about it? The price is kept a secret, however, it is known that the deliveries will start not earlier than 2018 (six times less what is being supplied to Europe), if ever, and that the Chinese insisted the price should be 260 dollars. So, it is in the vicinity of 300, a marginal income. It is largely a political deal.

okiey
21-05-2014, 14:06
Yes, have heard about it too. What is so breaking about it? The price is kept a secret, however, it is known that the deliveries will start not earlier than 2018, if ever, and that the Chinese insisted the price to be 260 dollars. So, it is in the vicinity of 300, a marginal income. It is largely a political deal.

Its a 30-year deal for $400 bln to supply 38 bln cum a year. That suggets $350 per 1,000 cum. Unclear whether the price is flat or indexed etc.

Unclear if its positive or not. Probably just a political victory for Putin.

Judge
21-05-2014, 14:24
The Chinese have cancelled the gas deal signing, they seem to be quite happy with their 300 dollars gas from Turkmenistan. Atrium, the largest European real estate developer, has cancelled all its projects in Russia. :watching:

Lesson for today Russkie Lad, don't gloat too early...:10293:

The price is a "commercial secret" for a few reasons, one being China probably doesn't want other gas supplying countries knowing how much it pays for Russian gas.. cos gas from Turkmenistan is cheaper,which might annoy Turkmenistan, or Russia doesn't want to show how much it gave in,but who really knows what was discussed behind closed doors,I suspect Russia thanked the Chinese leaders for backing Russia over Ukraine and they they will retrun the favour if ever China wants to spread its wings...


RL, look at how many jobs this gas deal will create, tens of thousands are going to be employed for many years to come....

Suuryaa
21-05-2014, 14:55
al will create, tens of thousands are going to be employed for many years to come....

Instead of developing environment-friendly sources of alternative energy.

Russian Lad
21-05-2014, 15:03
thanked the Chinese leaders for backing Russia over Ukraine

They abstained from voting, I don't remember any support. Being neutral doesn't mean being supportive. Now that the North Korea has been covered, the next visit should be to Zimbabwe and to Nicaragua, our other staunch and powerful allies. And let's not forget about Honduras. They also should be visited, though they voted against us in the UN. We still want to be like them.


Lesson for today Russkie Lad, don't gloat too early...

The price is a "commercial secret" for a few reasons, one being China probably doesn't want other gas supplying countries knowing how much it pays for Russian gas.. cos gas from Turkmenistan is cheaper,which might annoy Turkmenistan, or Russia doesn't want to show how much it gave in,but who really knows what was discussed behind closed doors,I suspect Russia thanked the Chinese leaders for backing Russia over Ukraine and they they will retrun the favour if ever China wants to spread its wings...


RL, look at how many jobs this gas deal will create, tens of thousands are going to be employed for many years to come....

Since we don't know the price we basically know nothing. It may as well be not profitable at all, who knows. Since when exactly Russia or China are fearful of Turkmenistan reactions? The Russian public now don't have the right to know for how much their national resources are sold??? What's next?


Instead of developing environment-friendly sources of alternative energy.

I would say instead of founding production enterprises, using this gas on our soil and selling products to other countries.