Philippines: South China Sea Oil and Gas Joint Development with China Conditional on No Sovereignty Infringement

Since military conflicts erupted between the United States, Israel, and Iran in late February, domestic oil prices in the Philippines have surged. Against this backdrop, some retired diplomats earlier published a white paper reiterating the suggestion of jointly developing oil and gas resources in the Reed Bank of the South China Sea with China, sparking public debate.

The Reed Bank is located within the Philippines' 200-nautical-mile exclusive economic zone (EEZ), over which China also claims sovereignty. The white paper cites US Geological Survey estimates that the Reed Bank and surrounding waters contain 11 billion barrels of oil and 190 trillion cubic feet of natural gas.

The Philippine Ministry of Foreign Affairs today issued a statement reiterating that the Philippines has sovereign rights over natural resources within its exclusive economic zone and continental shelf.

In response to public concerns about a possible resumption of Philippine-China oil and gas cooperation talks, the Philippine Ministry of Foreign Affairs emphasized that any related decision will be made "fully in accordance with the Philippine Constitution, domestic laws, and judicial precedents, and on the premise of the full exercise of national sovereignty."

The Philippine Ministry of Foreign Affairs pointed out that amid global energy uncertainty and the Philippines entering a "national energy emergency," President Ferdinand Marcos Jr. stressed the necessity of exploring all legal and feasible options to ensure national energy security.

The statement also said that Marcos Jr. instructed to keep communication channels open with China and engage through diplomatic means, including energy-related matters. Therefore, the Philippine Ministry of Foreign Affairs will continue to cooperate with relevant government agencies, but will ensure that any oil and gas cooperation arrangements are based on the principle of "Philippine sovereignty first."

The Philippines had also previously considered the idea of joint development of South China Sea oil and gas with China. In 2018, then-Philippine President Rodrigo Duterte signed a memorandum with China, agreeing to establish a framework for joint exploration of oil and gas in the Reed Bank.

Duterte at the time hoped that the resources jointly exploited would be split 2/3 for the Philippines and 1/3 for China. However, due to disagreements between the Philippines and China over the sovereignty of the exploration area, and potential constitutional disputes arising from joint exploration of South China Sea resources, Duterte terminated the relevant project before leaving office. (Editor: Hsieh Yi-hsuan) 1150412