Vietnam Halts South China Sea Drilling Project Under Pressure From Beijing
HANOI/SINGAPORE, March 23 (Reuters) - Vietnam has halted an oil drilling project in the "Red Emperor" block off its southeastern coast licensed to Spanish energy firm Repsol following pressure from China, three sources with direct knowledge of the situation told Reuters on Friday.
It would be the second time in less than a year that Vietnam has had to suspend a major oil development in the busy South China Sea waterway under pressure from China.
A source with direct knowledge of the situation said government ministries in Vietnam had paused the project while the decision-making politburo debates whether to suspend or indefinitely terminate the contract.
The decision, which hangs on whether the fees incurred by contract cancellation will exceed the cost of resisting Chinese pressure, is on hold until the politburo meets, the source said.
That meeting has been delayed by overseas trips by Vietnam's prime minister Nguyen Xuan Phuc, a series of visits by foreign dignitaries to Hanoi, and the death of former prime minister Phan Van Khai on Saturday.
"The ministries are determined to terminate the contract," said the source, who asked not to be identified because of the sensitivity of the situation.
A source with direct knowledge of the situation confirmed that the project, which is a joint venture with state oil company PetroVietnam, had been stopped following pressure from China.
A source at Repsol told Reuters high-level executives had been discussing how to respond to the pressure, which had been applied both directly by China, and indirectly via Vietnam.
A spokesman for Repsol in Madrid declined to comment. PetroVietnam executives declined to comment. The Vietnamese foreign ministry did not immediately respond to an emailed request for comment.
Asked at a regular briefing if China had pressed either Vietnam or Repsol, Chinese foreign ministry spokeswoman Hua Chunying said she did not know where such news had come from, but did not elaborate.
"We hope the relevant sides can work together to maintain the hard-earned positive situation in the South China Sea," she said.
'Red Emperor'
Red Emperor, known in Vietnamese as the Ca Rong Do field, is part of Block 07/03 in the Nam Con Son basin, 440 km (273 miles) off the coast of Vietnam's southern city of Vung Tau.
The $1-billion field of moderate size by international standards is seen as a key asset to help slow the decline of Vietnam's stalling oil and gas production.
But the block lies near the U-shaped "nine-dash line" that marks the vast area that China claims in the sea and overlaps what it says are its own oil concessions.
12
View Full Article
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- ExxonMobil Racks Up Discoveries in Guyana Block Eyed by Chevron
- Oil Market Sentiment Has Improved Significantly
- EU, US Eye Collaboration on Nuclear Materials
- USA Driving Activity to Increase to All-Time Highs
- TC Energy to Sell Prince Rupert Gas Pipeline Project to First Nation
- EU Electricity Export to Ukraine Up 94 Percent in Two Years
- China Coal Output Falls for First Time since Government Ordered More
- BP Pulse Buys One of Europe's Largest Truck Stops
- UK CCUS Plans Outdated: Think Tank
- North America Enters Rig Loss Streak
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Rystad Looks at the Buzz Around White Hydrogen
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension