Flashpoints

Vietnam Extends Oil Rig Operations Amid Vanguard Bank Standoff With China

Refusing to back down, Hanoi authorizes the extension of exploratory work by the Hakuryu-5 oil rig.

Ankit Panda
Vietnam Extends Oil Rig Operations Amid Vanguard Bank Standoff With China
Credit: Japan Drilling Company

Last week, the Vietnamese government announced that it would extend the operations of an oil rig on Vanguard Bank through September amid an ongoing standoff with China in the area. Hanoi and Beijing have been mired in a confrontation in recent weeks after China dispatched a survey ship and coast guard vessels to Vietnamese waters in the South China Sea, which it also claims under its capacious nine-dash line claim.

According to Vietnam’s Tuoi Tre newspaper, Vietnam’s Southern Maritime Safety Assurance Corporation announced that the Japanese-owned semi-submersible Hakuryu-5 oil drilling rig, which has been contracted by a joint Vietnamese-Russian venture, would conduct activities on Vanguard Bank through September 15. The decision represents an extension of operations from July 30. Hakuryu-5 began operations off the coast of Vietnam on May 12.

The announcement follows the Vietnamese government’s official call on China to pull back its assets from the disputed waters. “The Chinese survey ship, Haiyang Dizhi 8, and its escorts conducted activities in the southern area of the East Sea that violated Vietnam’s exclusive economic zone and continental shelf,” Vietnam’s Ministry of Foreign Affairs said in a statement earlier this month.

Haiyang Dizhi 8 is being accompanied by at least two China Coast Guard vessels, including the Haijing 3901, one of the largest coast guard vessels anywhere in the world.

The Vietnamese decision to extend the operations of the oil platform comes after the U.S. Department of State issued a statement backing Hanoi and criticizing China for what it termed “bullying” behavior in the area. Vietnam and China have faced off in recent years over access to probable hydrocarbon reserves in the South China Sea.

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Morgan Ortagus, a spokesperson for the U.S. Department of State, released a statement on Saturday condemning China’s “repeated provocative actions aimed at the offshore oil and gas development of other claimant states threaten regional energy security and undermine the free and open Indo-Pacific energy market.”

“China’s reclamation and militarization of disputed outposts in the [South China Sea], along with other efforts to assert its unlawful [South China Sea] maritime claims, including the use of maritime militia to intimidate, coerce, and threaten other nations, undermine the peace and security of the region,” the U.S. statement added.

In 2018, Chinese coercion succeeded in forcing Hanoi’s hand in canceling a project for Spanish oil firm Repsol in the area. In 2014, China moved an oil rig, the Haiyang Shiyou 981, into disputed waters, sparking a months-long crisis.

China and Vietnam, along with the Philippines, Malaysia, Brunei Darussalam, and Taiwan, are claimant states in the South China Sea.