China names state-owned firm in draft joint exploration deal, sets aside claims

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Metro Manila (CNN Philippines, November 20) — China wants state-owned China National Offshore Oil Corporation (CNOOC) to conduct oil and gas exploration in the disputed South China Sea – years after the firm's botched venture during the previous administration.

"China authorizes China National Offshore Oil Corporation as Chinese enterprise," according to a draft framework agreement penned by the Chinese government.

The document, titled "Framework Agreement on Joint Maritime Oil and Gas Exploration between China and the Philippines," was released to the media by opposition Senator Antonio Trillanes IV on Tuesday. It is not clear if changes have been made in the draft to date.

The document – marked as a Chinese draft – states that China and the Philippines have agreed to conduct joint oil and gas exploration in "relevant sea areas" in the South China Sea, but did not specify where.

The draft deal also leaves blank the company the Philippines has chosen to take on the joint exploration with China.

Businessman Manny Pangilinan, chairperson of PXP Energy, earlier said he hopes to restart talks with the CNOOC for a possible exploration in the West Philippine Sea. The two firms were earlier in talks to drill the disputed Reed Bank or Recto Bank, a disputed islet 85 nautical miles from Palawan.

The Department of Energy has since issued a moratorium on oil exploration and drilling works amid rising maritime tension with China. Duterte, as early as November 2017, said he may lift the moratorium.

Chinese President Xi Jinping is in the country to discuss plans for the joint exploration.

Meanwhile, Malacañang shrugged off concerns about the draft being prepared by China.

Presidential Spokesperson Salvador Panelo said he has not seen a copy of the draft, adding that he would ask the Foreign Affairs Department about it.

"It doesn't matter who drafted it. As far as we are concerned, you give us the draft, then we'll go over it. We have to see whether this is legal or not, whether it is beneficial to us or not," he said. "In the same manner that if we draft it, it will have to pass over them too."

Setting aside claims

Senators Trillanes and Kiko Pangilinan earlier called on the government to release the final draft of the joint exploration deal before it is signed.

They protest China's draft, saying it wants exploration, development and utilization of the resources to be jointly decided by Chinese and Filipino nationals. This is a violation of the Constitution, they argued, because it promotes a "co-ownership with China of the West Philippine Sea" when the Constitution states that "exploration, development and utilization of natural resources shall be under the full control and supervision of the state."

READ: Senators push for release of draft joint exploration deal with China

The Permanent Court of Arbitration in The Hague in July 2016 recognized the Philippines' sovereign rights in the West Philippine Sea, or areas of the South China Sea that lie within the country's 200-mile exclusive economic zone. China, however, rejects the ruling and continues to claim virtually the entire global waterway---parts of which are contested by the Philippines, Vietnam, Malaysia, Brunei and Taiwan.

The draft framework sets aside these claims.

"The joint oil and gas exploration shall not affect the respective position on sovereignty and maritime rights and interests of the two parties," the draft framework read.

China also wants to make things confidential amid the clamor for transparency.

"Any document, information or data concerning the joint maritime oil and gas exploration between the two parties shall be kept confidential, unless the two parties decide otherwise," it states.

CNN Philippines' Joyce Ilas and Eimor Santos contributed to this report.