'Compromise' needed before PH-China joint exploration: Palace

Dharel Placido, ABS-CBN News

Posted at Mar 05 2018 04:12 PM

MANILA - Malacañang on Monday said a compromise must be reached before the Philippines and China can start to jointly explore and exploit a portion of the South China Sea.

Presidential Spokesperson Harry Roque earlier said the Philippines was considering at least two areas in the disputed sea for possible joint exploration with China.

The two service contracts are SC 57, which covers offshore northwest Palawan or west of Calamian islands, and SC 72, which covers Reed Bank, a large tablemount off Palawan being claimed by China.

Roque said negotiations are needed in order for the joint exploration in the potentially gas-rich Reed Bank to push through.

“In SC 72, you have to thresh out these details because it will have to be agreed upon,” Roque said in a news conference in Malacañang.

“That’s on the assumption that 72 is contested territory. Of course, our position is it’s part of our exclusive economic zone.; China claims the same way. And that is 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.”

SC 72 will be governed by international law “because there has to be a treaty to be signed between the Philippines and China,” Roque said.

SC 57, on the other hand, will be carried out under the guidance of Philippine domestic laws, since the area is not being claimed by China, he added.

Philippine oil and gas firm PXP Energy Corp, formerly Philex Petroleum, has a 70 percent interest through its Forum Energy subsidiary in the Reed Bank project.


Discussions on SC 72 hit a snag after then President Benigno Aquino III questioned the basis of China's claims before an international arbitration court in January 2013, a case that Manila won shortly after he relinquished power to President Rodrigo Duterte in July 2016.

Duterte refused to flaunt the ruling, choosing instead to repair diplomatic and economic ties with Beijing as he shifted foreign policy away from Manila's traditional ally, Washington.

Duterte’s push for a joint exploration between the Philippines and China has been criticized by some, including Supreme Court Senior Associate Justice Antonio Carpio who said China will have to recognize the Philippines’ exclusive rights to exploit resources within its 200-nautical mile exclusive economic zone if Beijing wants to enter into a joint deal with Manila.

"They will agree on the commercial issues because you will just follow the industry rate and you cannot go wrong there. The stumbling block has always been insistence of China that we recognize that they have sovereign rights," Carpio told ANC's Headstart.

"We cannot do that anymore because there’s already a ruling and the Constitution says the State shall protect its marine wealth in its exclusive economic zone…and reserve its use and enjoyment exclusively for Filipino citizens," he said.

Jay Batongbacal, director of the University of the Philippines' Institute for Maritime Affairs and Law of the Sea, also warned that a joint development venture with China in the Recto Bank, which lies within the West Philippine Sea, may legitimize Beijing's claim in the disputed waters.

"We have a clearly legitimate claim, which has been validated by nothing less than the international tribunal. There is supposedly no overlap, and yet China continues to insist on its illegitimate claim," he told ANC's Early Edition.

"By accepting joint development, in essence we are accepting that illegitimate claim might have some currency, might have some substance to that," he said.