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Joint gas exploration puts China under PH control – Malacañang


By Argyll Cyrus B. Geducos

Malacañang said that China would have to comply to Philippine laws in case the joint exploration in Service Contract (SC) 57 pushes through as the said area is under the exclusive economic zone (EEZ) of the Philippines.

Presidential Spokesman Harry Roque issued the statement days after he announced that there are two areas that may be subjected to joint exploration by the Philippines and China, namely SC 57 and SC 72.

Roque, in a Palace press briefing Monday, said that since SC 57 is under the Philippine EZ, China would have to comply with domestic laws.

“As far as 57 is concerned, they will comply with the decision with La Bugal [ruling]. They can participate in exploration and exploitation provided, as the decision says, we have ultimate control over the exploration and the development,” Roque said.

The Palace official also confirmed that China would be under the control of the Philippines during the joint exploration on SC 57.

“They’re only a foreign entity engaged in exploration and development. But they have to do it under Philippine laws,” Roque said.

“They will absolutely be subject to Philippine laws if it is [SC] 57. It would have to be the mining code. The domestic law of the Philippines will prevail over [SC] 57,” he added.

According to Roque, the government will have to make sure that local mining laws are being complied with and that revenues earned from natural resources in SC 57 will be paid to the State.

According to the Philippine National Oil Company (PNOC) SC 57 was awarded to PNOC Exploration Corporation (EC) on Sept. 15, 2005. It covers a total area of 7,120 sq. km. in offshore Northwest Palawan and is situated around 50 kilometers northwest from the north-westernmost tip of Busuanga Island.

SC 72 differs

However, Roque said the same does not apply to SC 72 as there is an ongoing dispute in the said area between the Philippines and China.

SC 72 was awarded to Sterling Energy Ltd in June 2002. It is located in the West Philippine Sea, west of Palawan Island and southwest of the Shell-operated Malampaya Gas Field. SC 72 covers 8,800 square kilometers.

“As to [SC] 72, the agreement on joint exploration will be governed by international law because there has to be a treaty to be signed between the Philippines and China first on the joint exploration before it can be implemented by juridical entities of the contracting states,” Roque said.

“That’s why if we enter into an agreement, we’ll have to spell out the respective rights and obligations of the parties by way of a compromise,” he added.

Illegal, says Carpio

Any deal between the Philippines and a Chinese firm to jointly explore for gas in the Reed Bank of the South China Sea will be illegal unless China recognizes Manila’s sovereign rights there, Supreme Court (SC) Justice Antonio Carpio said.

The Reed Bank is claimed by both sides, but international law says it falls within the Exclusive Economic Zone (EEZ) of the Philippines. China says it falls within the so-called nine-dash line on maps recording its historic rights in the area.

Antonio Carpio, the acting top judge of the SC, said it was legal for the Philippines’ energy ministry to talk to state-owned China National Offshore Oil Corp (CNOOC) as a possible sub-contractor.

“There’s no problem as long as CNOOC will recognize that that is our exclusive economic zone,” he told news channel ANC in an interview. “But that is the problem, because CNOOC will not recognize (Philippine jurisdiction).”

Carpio was speaking as an expert on international law and staunch advocate for the Philippines to assert its maritime sovereignty claims.

Treaty first

According to Roque, there must be a bilateral treaty first signed between the States that would enable its nationals to engage in joint explorations.

He added that once the treaty is signed, then the service contracts are awarded in favor of corporations of the contracting states.

“When you agree to a joint development, you enter into a treaty which under international law, is defined as a written contract between two states governed by international law,” he said.

“So they contract as sovereign equals. They observe the principle of equality under international law,” he added.

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