Suit vs China: Oligarchs’ last resort to salvage their gas project in Spratlys

  • Reading time:11 mins read

A DISGUSTING penchant of the Yellows, even its oligarchs, has been to claim that their troubles are not just their own, but of others. The Lopez oligarchs claim their fight is that of ABS-CBN Corp.’s 11,000 employees and of the network’s millions of viewers. Maria Ressa claims that it is not she that the government has prosecuted for libel and tax evasion but the Press. Always, “Hindi sila nag-iisa.”

The most repulsive of such claims was the previous Yellow regime’s assertion that the suit it brought against China in 2013 over disputed claims to exclusive economic zones in the South China Sea, was the “Filipinos’ fight to assert the country’s sovereignty” against what former Foreign Affairs secretary Albert del Rosario said was the bully in Asia — China.

Del Rosario was really speaking not for you and me, but for the Indonesian-owned First Pacific Co. Ltd. Del Rosario had been for nearly two decades a director of First Pacific and/or its biggest subsidiaries such as PLDT Inc. and Metro Pacific Investment Corp.

Indonesian Salim, Razon and del Rosario: Was del Rosario speaking for them? PHOTOS FROM ANNUAL REPORTS

The arbitration suit brought against China in 2013 was principally a last desperate attempt for First Pacific and its partner, ports and casino tycoon Enrique Razon, to salvage their ambitious but reckless move in 2011 to totally ignore China’s warnings made three years back, and undertake explore and extract hydrocarbons in the Reed Bank in the Spratlys, Kalayaan Islands to us. (See my July 22, 2020 column, “Two oligarchs triggered our dispute with China,” for details.) That area in the Spratlys is claimed not just by the Philippines but also by Vietnam, China and Taiwan.

To file the suit in fact was the Benigno Aquino 3rd regime’s first reaction when that oligarch project was torpedoed in March 2011. For all the many urgent issues confronting the country, Aquino in his second State of the Nation Address in July 2011 announced what would be eventually done only two years later: “We are studying the filing of a case at the International Tribunal of the Law of the Sea [to address this concern].”

A week after Aquino appointed del Rosario in February 23 as his Foreign Affairs secretary, the First Pacific-Razon survey ship MV Veritas Voyager started its seismic surveys in the Sampaguita field in the Reed Bank. President Gloria Macapagal Arroyo a few months before she stepped down gave the First Pacific-Razon outfit the contract not just to explore but extract hydrocarbons in the area, called the Service Contract 72. China had objected, claiming that several times since 2007 the Arroyo government had promised it would not do so.

On March 2, 2011, China Maritime Surveillance vessels intercepted the Veritas Voyager survey vessel and shooed it away, claiming that the Reed Bank was Chinese territory. From then on, the Aquino government took a belligerent stance against China. Del Rosario shed his role as the country’s top diplomat — and instead ranted against China, calling on the Association of Southeast Asian Nations to pressure the superpower to give up its claims.

That del Rosario was livid over China’s stopping of the survey ship is explainable only if it was he who assured First Pacific that China would not block its project in the Reed Bank, and that the US would intervene if it did.

A CROWDED AREA Features in the Spratlys occupied by four claimants: Vietnam having the most, with 27 features occupied; the Philippines, 10; China, 7; Malaysia, 5; and Taiwan, just one but the biggest island in the area. MAP BY AUTHOR USING GOOGLE EARTH PRO

Most likely, del Rosario told its owner, the Indonesian Anthoni Salim and his top CEO Manuel V. Pangilinan, that this was what US Secretary of State Hillary Clinton had said in his talks with her when he was our ambassador to the US from 2001 to 2006. He likely told them that because of President Barack Obama’s “Pivot to Asia,” the US would intervene to demonstrate its resolve to maintain its hegemony in the South China Sea.

Aquino’s officials, especially the then ambassador to the US Jose Cuisia, frantically lobbied Washington, even Clinton, to pressure China to allow the First Pacific-Razon venture to explore the Reed Bank. The US did nothing, but it announced plans to increase its military aid to the Philippines in order to develop its naval capacity “to defend its territorial claims.”

A few weeks after the Reed Bank incident, the US State Department used an obscure provision of its 1961 Foreign Assistance Act to allow the quick transfer of its Coast Guard’s Hamilton-class cutter to the Philippine Navy. In just two months after the Reed Bank incident, the cutter was formally turned over to the Philippines.

Refurbishing of the cutter, and the installation of new weapons took several months. It finally reached the Philippines in December 2011, renamed the Navy’s BRP Gregorio del Pilar, the country’s biggest warship.

That was a brilliant, diabolical move by US strategists out to drive a wedge between the Philippines and China. It was like giving a pistol to a kid hanging out in the street corner. Not known for his intellect, Aquino delighted in what he saw as his new “war toy.” When China Maritime Surveillance ships blocked our Coast Guard from arresting Chinese fishermen in Scarborough Shoal, Aquino in April 2012 ordered the Del Pilar to the rescue.

He hastily ordered it to withdraw though, told that that was a big blunder. Indeed it was, as it gave China the high moral ground, claiming that the Philippines had militarized the dispute, sending a warship against “poor Chinese fishermen.” That triggered the Scarborough standoff from May to June 2012, during which vessels from each country refused to leave the shoal.

Again, the US strategists executed a diabolical move for us to hate China. US assistant state secretary Kurt Campbell told del Rosario that the Chinese had agreed to withdraw their ships from the shoal. Del Rosario believed Campbell, whom he had known since his stay in Washington as ambassador.

There was of course no such agreement with the Chinese, and so their ships remained in the Scarborough’s lagoon. From then on, our ships couldn’t get back there: We lost Scarborough Shoal, the first territory the Philippines already held but let slip through its hands, because of a president’s boo-boo.

With Beijing rejecting all requests by the Philippines to negotiate about the Reed Bank exploration, Pangilinan ate humble pie and went to Beijing in May 2012 to offer the state-owned China National Offshore Oil Corp. a stake in the project. The Cnooc rejected the offer totally, claiming that any such arrangement should be under Chinese laws.

By early July, and with the blunder of the Scarborough standoff also needing a smokescreen, the Aquino regime and the First Pacific-Razon duo decided on another move to salvage their mammoth Reed Bank project: Force China to allow the exploration and extraction of hydrocarbons there through some kind of international court order.

Aquino’s US lawyers told them that there was no international court that has the authority to decide on which country has legitimate sovereignty over a disputed territory. The Yellows had to settle only for an “arbitration” — even a compulsory one — for an international panel to rule not on sovereignty claims, but on “maritime entitlements” under United Nations Convention on the Law of the Sea (Unclos) — i.e., exclusive economic zones (EEZs).

Aquino’s lawyers — even the much-overrated former Supreme Court justice Antonio Caprio — very ignorantly thought that the country’s exclusive economic zone which encompasses the Reed Bank, gives it absolute sovereignty to explore and extract hydrocarbons there, based on the Unclos that took effect in 1982. However, one nation’s EEZs give it only sovereign rights, and cannot encompass the sovereign territory or territorial seas of another nation.

What they were ignorant, or pretended ignorance, of was that China, Taiwan and Vietnam claim the Reed Bank not because they have EEZs encompassing it, but because they claim it as part of their sovereign territory, an archipelago the Chinese call Nánshā Qúndǎo and the Vietnamese, Quần đảo Trường Sa. Both the Chinese and the Vietnamese claim this was part of their medieval kingdoms, and that treaties with colonial powers in the 19th to the 20th centuries affirmed their sovereignty claims over it. It was only in 1978, they claim, that the strongman Marcos grabbed it and decreed it as a municipality of Palawan. The two countries argue that the Philippines’ EEZ under Unclos that took effect only in 1982, and which is a treaty, cannot supersede their sovereign territories.

Aquino’s American lawyers were also ignorant, or pretended ignorance, of the fact that China’s claims over the Spratly were not based on the infamous nine-dash line, which a low-ranking Kuomintang Party bureaucrat had drawn on a Chinese map in 1947.

China has not defined at all what the hell the nine-dash line is, but has maintained it for undeclared reasons, one of which probably is so that it would not be criticized by the rogue Taiwan (set up by the Kuomintang when it fled China) as a weakening of its nationalism.

The US lawyers thought that by having the arbitral panel rule that the nine-dash line had no basis in the Unclos, it would mean that China had no claim over the Reed Bank.

The tribunal did rule that the nine-dash line has no basis in Unclos, but did not rule that China and Vietnam’s sovereignty claims over Reed Bank and the entire Spratlys were illegitimate.

It couldn’t after all.

Note: Salim, Pangilinan, Razon and del Rosario have so far not contested the claims I had made in my July 22 column, nor in my other past columns on the same topic. I interpret this acquiescence as their agreement to my statements.

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