The idealized Political economy of Chinese control of the massive Ca Voi
Xanh field
Nubian Observer analysis
The
distance as between the cities of New York City and Philadelphia
The official distance between the Chinese
first rig and Viet Nam is about the same distance as between the cities of New
York City and Philadelphia. The distance between the ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field and Chinese naval
forces of 137 ships is less than the
distance between Princeton and Philadelphia. Advanced elements of the Chinese
task extend almost 50 nautical miles toward the Vietnamese main land. Unknown
numbers of Chinese submarines are positions off the coast of Viet Nam ready to
attack Vietnamese cities.
A Russian made BrahMos missile less than
five minutes flight time from Vietnamese land missile batteries to the Chinese
taskforce. Both the Vietnamese and Chinese navies off the coast of Da Nang are
armed with deadly cruise missiles able to strike each other within a few
minutes.
The Chinese fleet is reaching the
Beijing political point of no return, without going to the ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field.
There is a de facto blackout western press discussion or reporting of the
distance between the two Chinese oil rig naval taskforces and the ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field which is less than a half day sail and is being
shortened by new Chinese navy deployments. The New York Times, Wall Street
Journal, Financial Times of London, Reuters, the Times of Japan and other
western newspaper maintain a de facto ban on connecting the Viet Nam/China
energy stand off to the ExxonMobil Viet Nam Ca Voi Xanh oil and gas field that
is kept under the press radar screen. Most every other aspect of the Chinese
naval forces is revealed in detail. Because of this critical omission by media
design, Americans understanding of the emerging strategically changing
situation remains time and distance distorted.
Beijing
is struggling to connect the Iraq crisis to Viet Nam because Chinese energy
policy is increasing driven by reactionary nationalism and proud. “I
do believe that China is not backing down from its claim,” Dennis McCornac, a
professor at Loyola University Maryland in Baltimore, told Thanh Nien News.“ To
do so would invite shame so they are playing more the role of the bully."
The Nubian Observer suggest that Beijing near term goal of the second oil rig
deployment less of a nationalist sides how and more of a calculated resource grab, i.e. the ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field. With the Viet Nam navy by design, in port,
the only means of resisting the physical seizer of the oil and gas field is a
massive Vietnamese missile strike.
China thinks there is massive oil and gas in Viet Nam water,
ExxonMobil is not saying anything
The Ca Voi Xanh 2X well is reported to
have encountered a significant hydrocarbon accumulation, comprised of between 4
and 7 trillion cubic feet (TCF) of recoverable gas, plus possibly some oil. Its
location, shape and depth remain above top secret ExxonMobil data. No one
really knows just how large the oil and gas field is or where it start and
ends. Be design, ExxonMobil has left the most of blocks 118 and 119
underdeveloped in order to keep China away. ExxonMobil is investing 20 billion
dollars in two gas powered industrial plants to power 40 per cent of southern
Viet Nam using block 117. China is trying to take the massive Ca Voi Xanh field
that may reach between block 117, 118 and 119 for its own use. Rather than pay
10 to 15 dollars a unit for natural gas at world prices, like Japan and South
Korea, China could reduced its energy bill by over a trillion and half dollars
a year by taking Viet Nam natural gas by force. As important, China would
effectively slow the process of Viet Nam uncoupling its economy form Beijing
control and linking itself to more advanced Japan, South Korea, Europe and the
United States advanced manufacturing supply chain members.
The first step in the Chinese master
plan take over process was moving easy missile target oil rigs and naval
escorts right in Viet Nam face daring the country to fight a war it can’t hope
to win with a country 14 times its population size, with no nukes or
operational submariners to defense it with.
When the Chinese oil rig was deployed to
Viet Nam, 137 Chinese ships were also deployed, many missiles armed daring Viet
Nam to come out and fight. Most main stream news report on the island issue or
the rig, few talk about the 137 ships, unknown number of submariner, some
nuclear armed and Chinese fighter jets. Since the private talks with ExxonMobil
have collapsed, Beijing has deployed five more oil rig with naval escorts to
the South China Sea to bail Viet Nam. American still know very little about the
strategic important of the Viet Nam Ca Voi Xanh oil and gas field. Just the 7
trillion cubic feet (TCF) of natural gas current being developed by ExxonMobil
in blocks may have is enough natural gas to fuel the most advanced eastern regions
and cities of China for the next 10 to 15 years. More importantly, Viet Nam may
have enough natural gas to fuel the economies of the South China Sea, Japan and
South Korea, aiding their transition to gas based power grid, leaving China
economically way behind. The Da Nang region is the most effective location to
process and refined natural gas and soon oil for the whole East Asian
industrial region. This is why the growing Chinese naval taskforce is stationed
off the coast of Da Nang, Viet Nam. Da Nang is where the massive undersea gas
pipe line comes ashore to processing and refinement plants.
The Chinese Rue
Beijing is baiting
the Vietnamese military with easy oil rig and large in order to provoke a
missile attack as a pretext for a war with Viet Nam in order to take the massive Ca Voi Xanh field
and maybe the Da Nang oil and gas complex.
China has no interest in another 100 million most poor farms to take care of;
Beijing is struggling to deal its own billion poor people and the tens of
millions of North Koreans.
“On 2nd May 2014,
the China National Offshore Oil Corporation (CNOOC) positioned the drilling rig
HD-981 in a location of 15°29’ North latitude, 111° 12’ East longitude,
approximately 120 nautical miles from Vietnam’s waters, within the exclusive
economic zone and continental shelf of Vietnam. CNOOC’s action violated
Vietnam’s sovereign and jurisdiction rights under the 1982 United Nations
Convention on the Law of the Sea.
On 4th May 2014,
PetroVietnam has sent a letter to the President and CEO of CNOOC strongly
opposing the action and resolutely demanding that the Corporation cease the
illegal actions immediately and move the HD-981 drilling rig out of Vietnam’s
waters.
The above action of CNOOC was against
the cooperative spirit between the two national oil and gas groups, practice of
international oil activities as well as the motto of friendship and cooperation
between Vietnam and China.
“It is about 120 nautical miles
east of Vietnam’s Ly Son Island and 180 nautical miles south of China’s Hainan
Island—the two nearest features that indisputably generate a continental shelf.
As such, it not only sits on Vietnam’s claimed extended continental shelf, but
also well on the Vietnamese side of any median line that might be negotiated
between the two shelves from the Chinese and Vietnamese coasts, as indicated by
the white lines in the map below.”
CSIS argues that China’s action violates UNCLOS
(parties should not jeopardize or hamper the reaching of a final agreement) and
the 2002 Declaration on the Conduct of parties in the South China Sea, signed
by ASEAN countries..
Beijing is trying to force ExxonMobil hand by playing on its greed
In a calculated new naval threat Beijing is trying
to force ExxonMobil into agreeing to jointly develop the Ca Voi Xanh oil
and gas field while appearing to sale out the Vietnamese national interest in
exchange for no war and massive region profits under Chinese military
protection. Beijing is offering ExxonMobil a deal, once China takes the Ca Voi
Xanh oil and gas field, to jointly develop it under Chinese control. The
political economy problem for China is the rest of Asian is far more important
to ExxonMobil long term energy planning, giving the collapsing Chinese export
economy. That is, computer integrated manufacturing is moving out of China and
into other Asian countries like Viet Nam. Those countries are positioning to
replace China critical valued added component supply chain. The abandonment of
China by Apple and other advanced computer integrated manufacturing is not a
micro moment, it a general trend, energy is only one element.
Beijing is trying to bait Hanoi into a missile
attack with the deployment of five new oil rigs with naval task forces near or
in striking distance of the ExxonMobil Viet Nam Ca Voi Xanh oil and gas
field. Beijing is playing a military chess game with Vietnamese and ExxonMobil
strategic planners hoping for a wrong move, so the Chinese can start a war.
Each of the now six oil rigs have a naval component, some large and some small,
all are designed create pressure on Vietnamese outer borders. Only two Chinese
oil rigs are really looking for oil and gas, these two rigs are moving closer
and closer to the ExxonMobil blocks 117,118 and 119.
The nine-dash line
The Nubian Observer suggests that if Viet Nam can resist being baited, the
Chinese oil rigs taskforce will first move into the western most end of block
142 and 143 searching for evidence of a gas-prone structure. If they find one,
the hold political matrix will change and Beijing will deploy all its rigs to
the region to develop oil and gas over the coming years. If the two oil rig
failed to find evidence of a gas-prone scaled oil and gas, which is likely the
case, then Beijing may elect to forcibly take up positions in the Chinese tips
of block 118 and 119 near the critical
China's
so-called nine-dash line, a boundary Beijing uses on its official maps to show
its claim to 90 percent of the South China Sea and continue to search
for oil and gas
looking for the outer
limits of the Nam Ca Voi Xanh oil and gas field during the tycoon season or go
home and come back next year leaving a sea based naval outpost on station.
Having failed to located scaled oil
or gas, Beijing will be faced with public humiliation and forced to either
retreat or push on the ExxonMobil oil and gas hoping to pick up a tail of a oil
and gas extending back to the nine-dash line. Beijing will have no political
pretext to employ. The moment of truth will upon them to make a strategic
decision about naked aggression and war. Chinese satellites know where the
ExxonMobil oil and gas is and the distance to the
nine-dash line from the oil and gas field. The nationalistic element
within Beijing leadership will mount a serious political struggle to seize the
field, once near it in force. The world will be watching the whole affair.
The Vietnamese coastguard
will be compression into the ExxonMobil
blocks and the approaches to the blocks will be mined and a few Chinese ships
maybe have be sank by mines and other Vietnamese counter means. Viet Nam and
ExxonMobil will pressure the White House to physically place a small USN force
between in the Nam Ca Voi Xanh oil and gas field as Viet Nam declares a
military zone around the field. A larger theatre force of US, Japan, South
Korean and maybe Australia forces will be massed on standby as the Da Nang
regional defense is layered.
As the first elements of the China naval taskforce moves to the western end
of blocks 142 and 143
the first and second “Hold Your
Breath” moments happened with deployment of the first and second Chinese oil
rig naval taskforces to the Da Nang region of Viet Nam setting the real time
conditions for a war between Viet Nam and China. The deployment of the five
Chinese oil rigs following formal meetings in Beijing between ExxonMobil CEO
and Chinese oil leadership suggests a Harding of ExxonMobil position about not
sharing the Viet Nam Ca Voi Xanh oil and gas field
. The second wave of five rigs
deployment evidence the powerful nationalism element within Beijing leadership,
even in the face of the Iraq crisis, which is not accounted for in Professor
Farley or other analysis. Beijing has made it clear, if all else fails, seizing
the ExxonMobil Viet Nam Ca Voi Xanh oil
and gas field
is a
military option. While ExxonMobil is an international corporation and not a US aircraft carrier, it political roots are American and the White
House has made it clear, its business interests will be defended by US military
force, if necessary. Short of ExxonMobil attacking Chinese naval forces, the United States and ExxonMobil are inextricably locked in
the Middle East and Pacific Rim’s system of international trade.
Looking a
gas-prone structure
According
to western media suggest Vietnam
isn't expected to react strongly to the placement of the second rig because it
lies far to the north of the
politically
sensitive waters surrounding the Paracel Islands, where ships from the two
countries have been ramming each other for more than 40 days near the first oil
rig. The border between China and Vietnam in the area of the second rig near
the mouth of the Tonkin Gulf has never been properly demarcated, despite five
rounds of talks on the matter.
Exxon CEO Rex Tillerson and CNOOC
Group Chairman Wang Yilin met in Beijing on May 14, the Chinese company said on
its website, adding they discussed “further cooperation” between the two energy
giants. It gave no specific details. The meeting was de facto blacked by the western press and remains off limits for
even RT.com political review. Only the Japanese main stream media, i.e. the Japan Times and Standard have
politically connected the dots of the Chinese rigs deployments to the energy rich ExxonMobil Viet Nam Ca Voi Xanh
oil and gas field in a systemic way
.
Neither ExxonMobil,
the CNOOC Group nor CNPC could not be reached for comment on the rig or the
field despite repeated attempts. However, a Chinese oil industry official with
knowledge of the field said a CNPC team that surveyed the block had told him
the potential was “pretty good,” based on data collected over a 10-year period.
“But of course we won’t know the exact amount of reserves until we drill,”
added the official, who declined to be identified because he was not authorized
to discuss the matter with the media. The Chinese are hoping that the energy rich ExxonMobil Viet Nam Ca Voi Xanh oil and
gas field extends well in blocks 118, 119 and 120. In that case, China could
legally force Viet Nam and ExxonMobil to share the oil and gas with them.
Low risk of China finding oil or gas,
buy what if they do
Experts said if the
rig found commercial reserves, China would bring in platforms for production
and pipe-laying ships to build the infrastructure to transfer gas to vessels.
That process could take several years, while production could last decades.
Following the May 14, 2014 ExxonMobil Beijing talks, a second rig naval
taskforce is in route to the region and purportedly a third and fourth rigs are
being ready for deployments. Each will feature Chinese submariner protection.
The rig lies approximately 330 km east of Vietnam and 370 km from the southern
coast of Hainan, just below the Paracel Islands, a chain occupied by Beijing
and claimed by Hanoi. Earlier this week, the rig was moved after having been
some 20 nautical miles closer to central Vietnam’s coast.
The rig lies about 330 kilometers east of Vietnam
and 370km from the southern coast of Hainan. It is just below the Paracel
island chain occupied by China and claimed by Hanoi.
Hanoi has said the Haiyang Shiyou 981 rig is in
its exclusive economic zone. China says its biggest and most advanced mobile
energy platform is operating within its waters.
Vietnam has two fields to the left of the rig,
much closer to its coast, where US giant Exxon Mobil discovered oil and gas in
2011 and 2012.
A part of Vietnam's
Blocks 118 and 119 fall within China's so-called nine-dash line, a boundary
Beijing uses on its official maps to show its claim to 90 percent of the South
China Sea.
"The
place where the rig is drilling at the moment is likely to be a gas field.
China conducted three-dimensional geological surveys before moving the rig
there," said Wu Shicun, president of the National Institute for South
China Sea Studies, a Chinese government think-tank on the southern island of
Hainan.
"China is pretty confident ... otherwise they wouldn't start
drilling," added Wu, a leading expert on China's ambitions in the South
China Sea.
No
production had taken place in Blocks 118 and 119, Do Van Khanh, head of
state-run PetroVietnam Exploration Production Corporation, told Reuters. He
declined to discuss the rig.
In a
2013 report, the U.S. Energy Information Administration, a government agency,
said geological evidence suggested the Paracels themselves did not have
significant potential in terms of conventional hydrocarbons.But
near the islands the chance of making a major gas discovery was high because
there had been several gas finds already in the area, said James Hubbard, head
of Asia oil and gas research at investment bank Macquarie in Hong Kong. “It’s
not a huge leap of faith to think they might be targeting a gas-prone structure,” he said.
The
Chinese are starting from the Paracels and working south toward the ExxonMobil
oil and gas field searching for the northern end of the energy rich ExxonMobil
Viet Nam Ca Voi Xanh oil and gas field which may lay within block 118 and 119.
Chinese discovery
of scale energy either oil or gas is a political game changer
“The tensions between the two sides will absolutely
rise to the top if China finds oil in that area,” said Duong Danh Dy, a former
Vietnamese diplomat. “There will be more collisions, more conflict. I would not
exclude armed conflict.”
In another political mistake, Beijing
has deployed a second oil rig to the waters off the coast of Viet Nam, only
weeks before the tycoon season removing any question of finding oil or gas in
the region before next year. So why the second oil rig now? Beijing is clearly
increasing the political and military pressure on Viet Nam for a missile
exchange.
Iraq, cause to
slow Chinese move on the energy rich ExxonMobil
Viet Nam Ca Voi Xanh oil and gas field
The U.S. reserve can hold the equivalent of about 95
days of imports, while China’s can probably now cover about 21 days, according to estimates by
Amrita Sen, a London-based analyst with Energy Aspects Ltd., a research
company.
Purchases for China’s strategic supply will pull 200,000 to 300,000 barrels
a day of crude from the global market this year, CEBM Group, an independent
investment advisory firm based in
Shanghai,
said in a March research note. Iraq is China’s fifth-largest overseas oil
supplier, behind top producer Saudi Arabia (which last year provided 19 percent
of the country’s 5.6 million barrels a day), as well as Angola, Oman, and
Russia. Over the last five years, state-owned oil and gas giant China National
Petroleum has
rapidly
expanded its presence in the Iraqi oil business. CNPC is now
operating four projects in the as-yet-untouched southern part of the country,
making it the single biggest foreign investor in Iraq.
Last year, CNPC produced 299 million barrels from Iraq, almost one-third of
its overseas output. Meanwhile, Chinese state enterprises, refiner
Sinopec and offshore player CNOOC, have both made big investments in Iraq’s oil
industry.
Increase Chinese imported oil from Iraq
and Iran was a strategic key to Beijing not having to deal with pro Viet Nam Saudi Arabia. One of the economic
blow back effects of the collapsing
Iraqi government is the reduction of long term oil from Iraqi to provide almost
six million bpd to China. Now China is forced to turn to the Saudis and
ExxonMobil for help. The Saudis may use the oil weapon to stop Beijing from
starting a war with Viet Nam.
The
distance as between the cities of New York City and Philadelphia
The deployment of a second Chinese rig
naval task force does not change the energy situation, but shorten the
logistical distance between Chinese forces and the energy rich ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field to hours, the most strategic energy field in
the East Sea claimed by both Viet Nam and China and developed by ExxonMobil. A Russian made BrahMos missile less than five minutes
flight time from Vietnamese land missile batteries to the Chinese taskforce.
Both the Vietnamese and Chinese navies off the coast of Da Nang are armed with
deadly cruise missiles able to strike each other in seconds.
The official distance between the rigs
and Viet Nam is about the same distance as between the cities of New York City
and Philadelphia. The distance between the ExxonMobil Viet Nam Ca Voi Xanh oil and
gas field and Chinese naval forces of 137 ships is less than the distance between Princeton
and Philadelphia. Advanced elements of the Chinese task extend almost 50 nautical
miles toward the Vietnamese main land. Unknown numbers of Chinese submarines
are positions off the coast of Viet Nam ready to attack Vietnamese cities.
Within this massive kill zone are USN
ships and submariners are mixing.
According to
a statement posted on the website of China’s Maritime Safety Administration,
the rig will be towed between June 18 and June 20 and is currently 104
nautical miles northeast of Da Nang (Vietnam's central hub) and 60 nautical
miles from China’s Hainan Island. The Chinese posting is careful not to inform
the reader just how near the rig to the ExxonMobil Viet Nam Ca
Voi Xanh oil and gas field which is directly between the Chinese 137 ships and
Da Nang 104 nautical miles or 10 hours at 10 mph or
five hours at 20 mph sail. A 1,000 mph cruise missile can reach a target in
less than six minutes.
The missile
distance between Vietnamese shore missile batteries and the Chinese force is
less than five minutes flight time.
As stated above, there is a de facto
blackout western press discussion or reporting of the distance between the two
Chinese oil rig naval taskforces and the ExxonMobil Viet Nam Ca Voi Xanh oil and
gas field which is less than a half day sail and is being shortened by new
Chinese navy deployments. The New York Times, Wall Street Journal, Financial
Times of London, Reuters, the Times of Japan and other western newspaper
maintain a de facto ban on connecting the Viet Nam/China energy stand off to
the ExxonMobil Viet Nam Ca Voi Xanh oil and gas field that is kept under the
press radar screen. Most every other aspect of the Chinese naval forces is
revealed in detail. Because of this critical omission by media design,
Americans understanding of the emerging strategically changing situation
remains time and distance distorted.
Beijing
is struggling to connect the Iraq crisis to Viet Nam because Chinese energy
policy is increasing driven by reactionary nationalism and proud. “I
do believe that China is not backing down from its claim,” Dennis McCornac, a
professor at Loyola University Maryland in Baltimore, told Thanh Nien News.“ To
do so would invite shame so they are playing more the role of the bully."
The Nubian Observer suggest that Beijing near term goal of the second oil rig
deployment less of a nationalist sides how and more of a calculated resource grab, i.e. the ExxonMobil Viet
Nam Ca Voi Xanh oil and gas field. With the Viet Nam navy by design, in port,
the only means of resisting the physical seizer of the oil and gas field is a
massive Vietnamese missile strike.
Beijing is
trying to bait Hanoi into a missile attack
In a calculated new naval threat Beijing is trying
to bait Hanoi into a missile attack with the deployment of a second oil rig naval
task force near the ExxonMobil Viet Nam Ca Voi Xanh oil and gas field.
Western media suggest Vietnam isn't expected to react strongly to the placement
of the second rig because it lies far to the north of the
politically sensitive waters surrounding the Paracel Islands, where
ships from the two countries have been ramming each other for more than 40 days
near the first oil rig. The border between China and Vietnam in the area of the
second rig near the mouth of the Tonkin Gulf has never been properly
demarcated, despite five rounds of talks on the matter.
By
Chinese tactical design, the second oil rig naval will force Viet Nam to
increase the size and composition of its naval blocking force. The Vietnam
naval force between the two Chinese naval groups blocking the southern approach
to the Ca Voi Xanh oil and gas field will be exposed to Chinese high speed end
around flanking and encirclement. Both Chinese task forces have The Type 52C Haikou has been hailed as the
"Chinese Aegis" as it is said to have similar capabilities to US
destroyers equipped with the Aegis system. The Haikou is equipped with eight
YJ-8 Chinese anti-ship missiles, though most of its weapons systems are geared
towards defense, with a four-array AESA multi-function phased array radar for
360-degree coverage. This is designed to limit the impact of Da Nang missile
batteries and increase the survivability of the Chinese naval forces for
counter strikes. In addition, Zhang Lisong, the political commissar serving
aboard the Liuzhou, a PLA Type 054A guided-missile frigate, told the Global
Times that large naval bases and floating facilities like the Haiyang Shiyou
981 rig are seen as easy targets for enemy forces.
"40% of the losses
in naval warfare history took place at the anchor site because warships or
other facilities are too large to evade enemy fire," said Zhang,
"Besides; it takes at least 20 minutes for them to be fully
operational."
Zhang said that enemy
forces can use their special divisions such as frogmen to launch an effective
attack as these forces or small-size mobile boats are extremely hard to be
spotted. To combat the threat of Vietnamese frogmen, China has introduced the
Russian-built 55mm DP-65 remotely controlled antidiversion grenade launching
system. Zhang added that the People's Liberation Army should also set a defense
perimeter around the rig to prevent unknown vessels or submarine from getting
too close.
Unknown
numbers of Chinese submariners are already positioning in back of the
Vietnamese coastguard forces, posed to seal the encirclement. Chinese ships
have already encircled Vietnamese ships in small groups. The deployment of the
second Chinese oil rig naval task force sets the preconditions for the
entrapment of a major Vietnamese coastguard force by Chinese naval forces,
baiting a Vietnamese missile attack.
On the very
day that a top Chinese diplomat arrived in Vietnam to discuss the dispute over
the Chinese oil rig deployed in Vietnamese waters, Beijing announced it was
towing yet another rig into what the rest of the world calls the South China
Sea.
According
to a statement posted on the website of China’s Maritime Safety Administration,
the rig will be towed between June 18 and June 20 and is currently 104
nautical miles northeast of Da Nang (Vietnam's central hub) and 60 nautical
miles from China’s Hainan Island.
Analysts say that by
deploying these rigs, China seek to reinforce what it believes is its
legitimate operation in the resources- and oil-rich East Sea.
“I do believe that
China is not backing down from its claim,” Dennis McCornac, a professor at
Loyola University Maryland in Baltimore, told Thanh Nien News". To
do so would invite shame so they are playing more the role of the bully."
McCormac believes that
the confrontation at sea is designed to distract a domestic audience from news
of flagging economic growth and traumatic news of violent attacks by
militant Islamic minority groups.
Other analysts say
China's recent move is less of nationalist sides how and more of a calculated resource
grab.
This camp believes that
China appears to be marking out areas for exploration that are legally and
practically convenient given their proximity to the China National Offshore Oil
Corporation bases and infrastructure on Hainan Island--where the state-owned
oil company can both supply and protect its rigs.
“That is perhaps why
Vietnam has been singled out by China, despite efforts Hanoi has made in recent
years to mend fences and pursue cooperation,” said Euan Graham, a maritime
analyst with Singapore's Nanyang Technological University.
The Nubian Observer
suggests the second jig deployment is a pretext to move the Chinese naval task
force into strategic position near the ExxonMobil Viet Nam Ca Voi Xanh oil and gas
field for an overnight seizer.
Saudis
warning China to back off Viet Nam
The lust of Iraq oil exports will force China to
turn to the Saudis for increased shipments. Saudi Arabia is warning China about
its brinkmanship toward Viet Nam in term Beijing and Tehran can understand. It
is Saudi own interests that China not be allow to take the ExxonMobil Viet Nam Ca Voi Xanh oil and gas
field and the Saudis have the oil weapon to enforce
their political will.
Saudis
warning to Iran to not meddle in Iraq is a clear message to Beijing to also
back off threading Viet Nam. As the final supplier of oil to China and only
country able to replace Iraq oil exports, Saudi Arabia holds the oil weapon that shapes the standoff between Viet
Nam and China.
(Reuters) -
Saudi Arabia gave an apparent warning to arch enemy pro Chinese Iran on Wednesday by saying outside powers should not
intervene in the conflict in neighboring Iraq.
Foreign Minister Prince Saud al-Faisal also said Iraq was facing a
full-scale civil war with grave consequences for the wider region.
His remarks coincided with an Iranian warning that Tehran would not hesitate
to defend Shi'ite Muslim holy sites in Iraq against "killers and terrorists",
following advances by Sunni militants there.
The toughening of rhetoric about Iraq by the Gulf's two top powers suggested
that Tehran and Riyadh have put on hold recent plans to explore a possible
curbing of their rivalry across the region's Sunni-Shi'ite sectarian divide.
Peace
seeking leaders around the world have been working behind closed doors to
reason with Beijing leadership in terms of the consequence of a war with Viet
Nam. A possible break through is emerging in Iraq that may cause Beijing to
rethink it brinkmanship in the East Sea with Viet Nam. A war with Viet Naw
would potentially collapse world energy market and play right into the hands of
the Islamic State of Iraq and al-Sham. China’s Iraqi oil imports would be at
serious risk alone with the central government.
According to Wall Street Journal: The Iraq Debacle
An extended civil war is likely. A terrorist caliphate is
possible.
The magnitude of the debacle now unfolding in
Iraq is becoming clearer by the day, with the terrorist army of the Islamic
State of Iraq and al-Sham, or ISIS, marching ever closer to Baghdad. On Tuesday
the al Qaeda affiliate captured Mosul, a city with a population greater than
Philadelphia's, a day later it took Tikrit in the Sunni heartland, and on
Thursday ISIS commanders announced they plan to attack the Shiite holy cities
of Najaf and Karbala.
No one should underestimate the danger this
presents to the stability of the region and to America's national and economic
security. An extended civil war seems to be the best near-term possibility.
More dangerous is ISIS's ambition to establish a Muslim caliphate in the heart
of the Persian Gulf, which would mean a safe haven for Islamic terrorism that
would surely target the U.S. The danger to Iraq's oil exports of three million
barrels a day is already sending prices up and global equities down.
The threat to Baghdad is real and more imminent
than is widely understood. Four Iraqi divisions have melted away before the
3000-5,000 ISIS force, which is gaining deadlier weapons as it advances. One
source says Iraqi soldiers who are supposed to protect Baghdad are dressing in
civilian clothes beneath their military uniforms in case they have to flee.
Iraq's air power, such as it is, could soon be grounded if civilian contractors
are endangered.
The danger to Iraq's oil exports of three
million barrels a day is already sending prices up and global equities down.
China is importing over a million barrels a day from southern Iraq and is
growing concern because it has no military forces on the ground in order to
control oil flow out of the country.
A Viet
Nam thing for thing, Beijing asking the White House and ExxonMobil for help
China has privately turned
to the United States and ExxonMobil for military force to ensure its critical oil
exports from Iraq, will China back off Viet Nam? China imports almost 50 per
cent of Iraq oil exports which are produced in part by ExxonMobil and other oil
majors China is struggling with in the South China Sea. The Iraq crisis has
created the face saving political thing for thing Beijing leadership needs to
control the nationalistic elements within its military to provoke a Viet Nam
military confrontation.
There was little China
can do to immediately bolster the Iraqi government and protect their interests,
despite aid it has offered to Baghdad in the past. The Saudis will not allow
Chinese military boots on the ground in Iraq. "The situation shows how
mixed up the geopolitics of the Mideast and oil have become," said Daniel
Yergin, the vice chairman of research group IHS and a noted oil historian.
"This time, the U.S. and China and Iran are all on the same side, trying
to preserve the Iraqi state - each of them with their own interests, and all of
them unprepared and caught by surprise," he said. China had asked
Iraq's government to ensure the safety of Chinese people in the country, Hua
said, though she did not say if any there had been any effect on Beijing's oil
interests there. State-run China National Petroleum Corporation (CNPC), China's
biggest oil and gas producer, has three projects in Iraq, in the country's south
and southeast. Most of Iraq's oil drilling and export facilities are in the
south, where al Qaeda-inspired groups have little support. They are not
expected to be as vulnerable to insurgents as infrastructure in northern Iraq.
According to the New York Times “Still, Iraq plays
an important role for market stability. With current production of 3.3 million
barrels of oil a day, Iraq is the second-largest producer in the OPEC cartel,
and it has the potential to become a far larger player on the world stage.
Current predictions by the International Energy Agency show Iraqi production
growing to 4.4 million barrels a day in 2015 and to nearly 6 million barrels a
day by 2020.
That kind of growth will require large amounts of
foreign investment to resuscitate Iraqi oil fields that were poorly maintained
for decades under the Saddam Hussein regime. The Western oil giants ExxonMobil, BP, Royal Dutch Shell,
Occidental Petroleum and Chevron have plowed significant resources in the
southern Iraqi fields and the Kurdistan region of northern Iraq. They also have
the skilled talent and expertise that Iraq needs and cannot always get from
Chinese and other non-Western oil companies investing in the area.