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Vietnam warns China to halt oil bids in South China Sea

Vietnam’s state-run oil explorer warned China to halt efforts to develop disputed areas of the South China Sea that Hanoi’s leaders have already awarded to companies including Exxon Mobil Corp. and OAO Gazprom.

Vietnam Oil & Gas Group, also known as PetroVietnam, will ask China National Offshore Oil Corp., the government-owned parent of Cnooc Ltd., to cancel an invitation for foreign companies to explore nine blocks, Chief Executive Officer Do Van Hau told reporters in Hanoi yesterday. PetroVietnam and its partners will continue exploring in the area and asked foreign companies not to bid for the nine blocks, he said.

PetroVietnam will “unwaveringly oppose” any foreign companies that sign contracts with China to explore for oil in the nine areas, Hau said. “The Vietnamese government will not allow any implementation of these exploration activities.”

The tender threatens to escalate tensions after Chinese vessels last year cut the cables of a PetroVietnam survey ship and chased away a boat in waters delimited by the Philippines. The blocks are the southernmost put out for bid by China in about two decades, according to Arthur Ding, a research fellow at the Institute of International Relations in Taiwan.

“This is one way for China to assert its maritime territory,” he said by phone. “There’s probably more to come. Domestic pressure was building up so they had to do something.”

The state-run company deployed China’s first deep-water drilling rig last month near disputed islands. The blocks, covering an area of 160,124 square kilometers, are available for exploration and development with foreign companies this year, according to a June 23 statement on the company’s website.

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