The Philippines is seeking to develop the seabed hydrocarbon resources of Reed Bank in the South China Sea, an area under dispute with China. Should Manila put plan to action, Beijing is likely to dispatch enforcement vessels to disrupt such activities. Given the deteriorating bilateral relationship, tensions between the two countries are in danger of escalating to the point of brinkmanship.
On May 9, amid rising tensions between China and Vietnam following China’s deployment of a deep-sea rig in disputed waters near the Paracel Islands, the Philippines’ Department of Energy launched a tender for exploration rights to 11 oil and gas blocks. Included in this tender round is “Area 7”, located in an area of the South China Sea known as Reed Bank, which China also claims. Less than two weeks later, on May 21, Philex Petroleum Corp of the Philippines announced that its London-listed unit, Forum Energy Plc, plans in early 2016 to start drilling appraisal wells in the Sampaguita gas field, also at Reed Bank.