Vietnam Clash with China in the disputed East Sea (Formerly South China Sea)

Vietnam's foreign ministry has accused China of increasing regional tensions in an escalating territorial dispute.

A rare weekend news briefing followed a confrontation in the EAST SEA (Formerly known as South China Sea) between a Vietnamese oil and gas survey ship and Chinese patrol boats.

Vietnam says the boats deliberately cut the survey ship's cables in Vietnamese waters. China denies the allegation.

China, Vietnam, the Philippines, Malaysia, Brunei and Taiwan all claim territories in the EAST SEA (Formerly known as South China Sea).

The area includes an important shipping route and is also thought to contain oil and gas deposits.

The spat comes just days before a regional security conference in Singapore.

Beijing said its defence minister would attend the International Institute of Strategic Studies to promote co-operation and stability in the Asia Pacific region.

'Clash with high speed Chinese Patrol Boat'

The latest clash involving Chinese patrol boats occurred 120km (80 miles) off the south-central coast of Vietnam and some 600km south of China's Hainan island.

"The Vietnamese navy will do everything necessary to firmly protect peace and the independence, sovereignty and territorial integrity of Vietnam," foreign ministry spokeswoman Nguyen Phuong Nga said.

One of three Chinese patrol vessels on the scene intentionally cut a submerged cable towed by the ship, the Binh Minh 02, said Do Van Hau, deputy chief executive of state oil and gas group PetroVietnam, which was operating the ship.

"Chinese vessels were at very high speed and did not respond to our ship's warning and then cut the cables of the Binh Minh 02, about 2km from where it was positioned," he said.

China's foreign ministry blamed Vietnam for the incident, saying its oil and gas operations "undermined China's interests and jurisdictional rights".

China's claim in the EAST SEA (Formerly known as South China Sea) is by far the largest, and includes the Spratly and Paracel archipelagos.

Taiwan recently said it would improve the defense capability of more than 100 coastguard troops stationed in a disputed area of the EAST SEA (Formerly known as South China Sea).

Taiwan's decision was announced shortly after the Philippines increased the pressure recently by lodging a protest at the United Nations against China's claims to the area.

Last year, China sharply rebuked US Secretary of State Hillary Clinton when she said the US supported the freedom of navigation in the area and offered to facilitate multilateral talks on the disputes.

 

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40 Australian Oil and Gas Exploration firms keen on investing in the Philippines this year

Oil and Gas: At least 40 prominent Australian oil and gas exploration companies have expressed strong and keen interest in investing in the Philippine upstream oil and gas industry, a favorable start for the government’s international road show for the Philippine Energy Contracting Round (PECR 4).

These interested companies include Shell, Apache, Chevron, AWT International, Black Swan, CalEnergy, Cue Energy Resources, ENI Australia, Exxon, Neon Energy, Otto Energy, Woodside, Anglican Resources PLC and Tap Oil, Energy Undersecretary Jose M. Layug Jr. said.

“The investor interest is overwhelming and everybody is keenly awaiting the availability of the DoE technical data for their immediate evaluation. We were pleasantly surprised with the turnout despite the short notice,” Layug noted.

“This is a validation of continuing international confidence in the Aquino administration. We hope this will result in new oil and gas discoveries within Philippine territory. It comes at an appropriate time especially with the current high oil price environment,” added Energy Secretary Jose Rene D. Almendras.

The Australian roadshow held last May 23 was a kick-off event to promote the official launch of the PECR 4 this coming June 30. The DoE has also scheduled roadshows in Singapore, Houston and London. This early, many investors have already registered for the Singapore and London presentations and have been awaiting information pertaining to the blocks to be offered, Layug said.

PECR 4 formed part of President Aquino’s long-term plans to address the Philippines’ need for oil and gas and to reduce the country’s dependence on costly imported oil.

This platform provides for transparent and competitive system of tendering onshore and offshore oil and gas blocks for exploration to interested oil and gas companies. Under this process, the Department of Energy will determine the winning bidders based on specific technical, legal and financial criteria, after which the President of the Philippines will have to award the service contracts.

As many as 15 contracts for the exploration, development and production of prospective oil and gas sites may likely be auctioned off this June 30, 2011. These areas span across 7.92 million hectares of areas in Cagayan, Central Luzon, Northwest Palawan, Mindoro-Cuyo basin, East Palawan and Sulu Sea and  Cotabato. Northwest Palawan is home to the Malampaya deep water gas-to-power project, the largest and most successful natural gas industrial project in Philippine history.

Layug stressed the need to develop these new areas as the demand for oil in the Philippines has been estimated at 300,000 barrels per day. The entry of new companies that would venture into exploring and developing the country’s indigenous resources would reduce its dependence on imported petroleum products, he explained.

The utilization of indigenous resources would also promote savings in tariffs and importation duties, Layug added.

Currently, there are 28 active petroleum service contracts in the Philippines with Exxon Mobil, Shell Philippines Exploration, Nido Petroleum, BHP Billiton and Galoc Production Co. among the operators.

 

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GDP of the Philippines growth 4.9% in 1st quarter

Asian Economy: The economy grew by a lower-than-expected 4.9 percent in the first quarter of the year due to a drop in global trade and government underspending on infrastructure.

The National Statistical Coordination Board (NSCB) said gross domestic product (GDP) growth in the three months to March was lower than the 8.4 percent rise posted in the same period last year, when economic activity was boosted by election-related spending.

The first quarter figure was also below the 5.1 percent median forecast in a previous poll of economists, and was near the low end of the government’s projection of 4.8 percent to 5.8 percent growth, based on the 1985 price series.

“Underspending by the government and the slowdown in global trade constricted the economy to a lower growth of 4.9 percent in the first quarter,” NSCB Secretary-General Romulo Virola said in a statement.

On a seasonally adjusted basis, the economy expanded by 1.9 percent in the March quarter from the previous three months, after growth of 0.5 percent in the fourth quarter of 2010, which was recalculated with 2000 as base year.

Overall growth in the previous years have been revised using 2000 as base. Earlier this month, the government said expansion in 2010 was 7.6 percent under the new data series compared with 7.3 percent under the old.

The government is aiming for a full-year GDP growth rate of 7 percent to 8 percent this year, a goal it set before the political unrest in the Middle East and North Africa erupted, and Japan’s earthquake, tsunami and nuclear disasters.

NSCB reported that gross national income (GNP), which includes income from abroad, expanded 3.6 percent in the first quarter from 11.5 percent last year. The drop was partly due to crisis in the Middle East and North Africa, key sources of remittances from overseas-based Filipino workers, as well as the appreciation of the peso against the dollar.

For his part, Socioeconomic Planning Secretary Cayetano Paderanga Jr. said the first quarter performance was within the National Economic and Development Authority (NEDA) forecast of 4.8 percent to 5.8 percent for the first three months of the year.

Paderanga said that agriculture, hunting, forestry and fishing rebounded by 4.2 percent from a contraction in the same period last year.

“This was mainly due to increased yield, expansion in harvest areas and full milling operations in major producing areas of palay, sugarcane, and corn. Meanwhile, the high demand for chicken meat both from households and fast food chains helped push poultry production,” the Socioeconomic Planning chief said.

Similarly, the industry sector grew by 7.2 percent growth, supported by the expansion in manufacturing, construction, and mining and quarrying.

The services sector, which remains as the largest contributor to GDP with 55 percent share, grew by 3.7 percent on account of other services, real estate, transport, storage and communication, and finance, Paderanga also said.

However, Paderanga said that for the government to meet the seven percent to eight percent growth target for the year, the implementation of appropriate policies supportive of growth must be undertaken.

“To have a stronger growth in the coming quarters in spite of the risks and uncertainties surrounding the country, the timely and effective implementation of appropriate policies and reforms will be undertaken. These include measures such as addressing corruption and making the bureaucracy more efficient by streamlining processes to lower the cost of doing business for the private sector as well as expediting the release and utilization of budget for a more efficient timely implementation of programs and projects,” Paderanga said.

However, Paderanga said that for the government to meet the seven percent to eight percent growth target for the year, the implementation of appropriate policies supportive of growth must be undertaken.

“To have a stronger growth in the coming quarters in spite of the risks and uncertainties surrounding the country, the timely and effective implementation of appropriate policies and reforms will be undertaken. These include measures such as addressing corruption and making the bureaucracy more efficient by streamlining processes to lower the cost of doing business for the private sector as well as expediting the release and utilization of budget for a more efficient timely implementation of programs and projects,” Paderanga said.

He also said the interagency Development Budget Coordination Committee (DBCC) would be reviewing the 2011 growth goal of seven percent to eight percent.

However, Paderanga was mum on whether or not NEDA would recommend a downward adjustment in the growth projection for the year.

Had the government spent more during the period, NSCB’s Virola said the economy would have grown a faster pace of 5.1 percent.

 

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