PH, China sign oil and gas deal

Dharel Placido, ABS-CBN News

Posted at Nov 20 2018 06:49 PM | Updated as of Nov 20 2018 09:06 PM

PH, China sign oil and gas deal 1
Visiting Chinese President Xi Jinping and Philippine President Rodrigo Duterte wave to the media before their one on one meeting at the Malacanang presidential palace in Manila, Philippines, November 20, 2018.Erik De Castro, Reuters

MANILA (2nd UPDATE) - The Philippines and China on Tuesday signed a memorandum of understanding on cooperation on oil and gas development, as the two countries sought to improve ties despite a bitter maritime dispute in the resource-rich South China Sea.

Foreign Affairs Secretary Teodoro Locsin Jr. and Chinese Foreign Minister Wang Yi exchanged signed copies of the memorandum of understanding on cooperation on oil and gas development.

Energy Secretary Alfonso Cusi described the cooperation as a “solution [on] how we can enjoy resources in the area,” referring to the disputed South China Sea.

The oil and gas deal was one of 29 pacts involving trade and investment, banking and finance, infrastructure, agriculture, education, culture, and people-to-people exchanges that the Philippines and China signed during the 2-day state visit of Chinese President Xi Jinping.

Jay Batongbacal, director of the University of the Philippines Institute for Maritime Affairs and Law of the Sea, said the pact is "just an agreement on what principles will govern actions."

"It's slightly less than a full formal and very detailed agreement," Batongbacal told ANC's "Beyond Politics" Tuesday.

Batongbacal added that the agreement is an "interesting one" since it "avoids provisions that will invoke legal issues."

The Philippines, under Duterte, and China are hoping to jointly explore and develop portions of the South China Sea, believed to be rich in oil and gas. It is not yet clear, however, whether the oil and gas deal signed Tuesday would cover the hotly contested waterway.

China claims nearly all of vital sea lane, contradicting with partial claims of the Philippines, Vietnam, Brunei, Malaysia, and Taiwan. 

The Philippines in 2016 defeated China in a United Nations-backed arbitral tribunal, which invalidated Beijing’s economic claim to the strategic sea lane.

President Rodrigo Duterte, however, has chosen to set aside the ruling in exchange for better economic ties with Asia’s largest economy.

China has ignored the ruling and insists it has sovereignty over the waters. Duterte, meanwhile, has raised little opposition to China’s continued military activities in the area.

Duterte had said that despite his government’s rapprochement with China, he would never surrender the country’s claims to the sea and would bring up Manila’s arbitration victory against Beijing at the appropriate time.

Below is the full list of deals that the Philippines and China signed Tuesday:

1. MOU on cooperation on the Belt and Road Initiative
2. MOU on cooperation on oil and gas development between the Philippines and China
3. MOU between the Foreign Service Institute of the Philippines and the China Foreign Affairs University
4. Executive program of the cultural agreement between the governments of the Philippines and China for 2019 to 2023
5. MOU on basic education cooperation between the Department of Education and China’s Ministry of Education
6. MOU between the Department of Information and Communications Technology and Ministry of Industry and Information Technology of China
7. MOU between the Cooperative Development Authority of the Philippines and Ministry of Agriculture and Rural Affairs of China on strengthening the building of agricultural cooperatives
8. Infrastructure cooperation program between the Philippines and China 
9. Program for cooperation on industrial parks development between the Philippines and China
10. Handover certificate of emergency humanitarian cash assistance between the Philippines and China
11. MOU on jointly promoting the cooperation in key infrastructure projects in Davao region between the Philippines’ Department of Finance and Ministry of Commerce of China 
12. Handover of certificate of humanitarian cash assistance between the governments of Philippines and China
13. Implementation agreement of a feasibility study for the Davao City Expressway project
14. Implementation agreement of a feasibility study for the Panay-Guimaras-Negros islands bridges project
15. MOU on a Renminbi clearing arrangement
16. Protocol for phytosanitary requirement for export of fresh young coconuts from the Philippines to China between the Philippines' Department of Agriculture and the General Administration of Customs of China and phytosanitary requirements for export of frozen fruits from the Philippines to China
17. Agreement on economic and technical cooperation between the governments of the Philippines and China
18. MOU on supporting a feasibility study of nature projects between the Department of Finance and China International Development Cooperation Agency
19. Exchange of letters on a container inspection equipment project
20. Exchange of letters on the Davao River Bridge Project 
21. Exchange of letters on China-aided bridge and road projects in Marawi
22. MOU on panda bonds issuance
23. Loan agreement on the New Centennial Water Source Kaliwa Dam Project 
24. Commercial contract of Safe Philippines Project Phase 1
25. Commercial contract of the New Centennial Water Source Kaliwa Dam Project 
26. Framework agreement for industrial parks between the Philippines Bases Conversion and Development Authority and China's Gezhouba Group
27. Contract for the project management consultancy of the Philippine North-South Railway Project
28. Letter of no objection to the organization of the Renminbi-Philippine peso foreign exchange trading market
29. Certificate of authority to operate the Industrial and Commercial Bank of China Limited Manila branch