The Reed Bank is an area west of Palawan and within the Philippines 320 km exclusive economic zone but its ownership however is disputed by the countries of China and Vietnam. Exploration of the Reed Bank has shown that it could contain about 3.4 trillion cubic feet of natural gas and 440 million barrels of oil. The area is much closer to the Philippine island of Palawan compared to the even hotly contested Kalayaan Island Group of the Spratlys.
Plans raised for the Philippines to mine the area of its energy minerals has resulted in China announcing its objection to the idea. Chinese Ambassador Liu Jianchao said yesterday that the plan is a violation of Chinese sovereignty, but he is confident that the matter can be settled through negotiations. He also said that unilateral economic activity is not allowed in areas subject of a territorial dispute.
Forum Energy Philippines Corp., which has completed its geophysical survey and exploration contract on the Reed Bank, said that they are only waiting for the “go” signal from the Department of Energy to begin their project of extracting the oil.
Dept of Energy Secretary, Angelo Reyes, said however that the contract was still being evaluated because of some government departments may have concerns about it. unnamed sources quoted by local media said however that the government was proceeding with caution because the area was surveyed by China, the Philippines and Vietnam last year to seek out petroleum reserves in the disputed sea.
Kinda makes sense why the Philippine President went out of her way to have her picture taken with the US president recently and to always project good relations between the two countries. To show to the world that we have good ties with the United States and that they will always run to our aid. The question is, if it is really effective? Considering that China owns a lot of the United States debt and that they are a major trading partner. Well, considering that the Philippines was once a colony of the United States, there might be more meat in that sandwich than it looks. Added further if she partner’s up with a US oil company to drill there and you could just easily have a US aircraft carrier parked their.
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Category: Oil, Oil Price
