Next oil and gas rush - South China Sea?

China relies on foreign oil and wants to increase its own production. Vast reserves potentially await off its coast, but not without territorial disputes.

Vast sea, vast reserves? The South China Sea stretches from China to Indonesia and is believed to hold oil and gas riches.

China's largest offshore oil and gas company is seeking foreign partners to help it explore another 26 blocks, including 22 in the South China Sea where a similar move by China earlier this year in disputed territory angered Vietnam.

China National Offshore Oil Co., a self-described "mega government owned company," announced the new initiative on its website, noting that the 26 additional blocks cover 73,754 square kilometers (28,476 square miles), at depths between 500 meters (1,640 feet) and 3,000 meters (9,842 feet).

It is giving foreign companies until November 30 to review data. Those companies would then submit a partnership plan.

As Reuters notes, "the tender comes two months after CNOOC invited international firms to bid for nine blocks in the western part of the South China Sea, a move Vietnam said was illegal as the blocks encroached on its territorial waters." China disputed Vietnam's assertion.

Reuters quotes Huang Xinhua, a geologist at energy consultancy IHS, as saying that none of the new blocks appear to be in disputed areas.

The South China Sea stretches from China to Indonesia and is believed to hold vast reserves of oil and gas. China claims most of the body of water. Vietnam, the Philippines, Malaysia, Brunei and Taiwan also claim portions.

China is a net importer of oil, and is trying to increase domestic production. The CIA estimates that China consumed 9.4 million barrels of oil a day in 2011 and imported 5.08 million barrels a day.

Image: from Perry-Casteñeda Map Collection via Wikimedia.

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