Threat to China: Will Corporatists in U.S. Government Move Forward to Assist Big Oil in Vietnam Discovery?

Brandon Turbeville

Activist Post

November 9, 2011

ExxonMobil, the world’s largest publicly traded company (by market value), has announced a “potentially significant” gas discovery off the coast of Vietnam. 

 It is now almost universally accepted among the general population and political commentators as a foregone conclusion that the United States and China will eventually face off in direct conflict at some point in the future. The decline of the American Empire and the simultaneous rise of the Chinese Empire will no doubt cause the two imperialist nations to butt heads eventually, most likely resulting in currency wars, diplomatic disputes, proxy military battles and, ultimately, direct military confrontation.

The massive amount of U.S. Treasury bills held by China, as well that of other Western countries, is becoming an increasingly unstable situation economically the world over. Indeed, China has expressed antipathy toward being considered the worthless currency recycling bin, and is a powder keg that is almost ready to blow. Especially as holding on to Western currency becomes less and less advantageous for Chinese economic policy. When the powder keg does blow, Western currency  - American currency in particular – will be smashed to pieces.

Not only that, but with the acceleration of foreign policy disagreements between the U.S. and China also on the rise, specifically but not limited to areas like Tibet, Taiwan, Libya, Africa (as a whole), North Korea, and Iran, the likelihood of direct military conflict looms even heavier as time progresses and as each empire marches forward in imposing their wills on masses of people who merely wish to be left alone to control their own destiny.

However, yet another issue has arisen that will only serve to heighten the tension between the United States and China. Interestingly enough, as has so often been the case in recent years, the United States will find itself tangled in another affair centered around oil and initiated at the behest of the large multinational oil companies.

As Dr. John Daly of OilPrice.com reports, ExxonMobil, the world’s largest publicly traded company (by market value), has announced a “potentially significant” gas discovery off the coast of Vietnam. The company stated in a press release, “We can confirm ExxonMobil Exploration and Production Vietnam Limited drilled its second exploration well offshore Danang in August 2011 and encountered hydrocarbons.”

Vietnam, the third largest oil exporter in South Asia, has been exploring its gas reserves as far back as the 1970s, yet only in 2004 did it begin to offer contracts for offshore exploration to a wide range of international companies, ExxonMobil being one of them. There are also other American companies involved in oil and gas exploration efforts in Vietnam as well as companies from Canada and India.

The exploration currently taking place is being conducted in blocks 117, 118, and 119, near Danang, which Vietnam is claiming lies within the 200-mile exclusive economic zone that exists as a legal and territorial designation under the international maritime law.

The problem is that these blocks are located in the South China Sea, a region whose offshore resources are being claimed by a total of six countries – China, Vietnam, Malaysia, Brunei, Taiwan, and the Philippines – all of whose claims overlap each other several times. The fact that these resources involve, at the very least, billions of dollars is enough to ensure that the claims being made in regards to them are not likely to be easily dropped. Indeed, if anything, they are only going to intensify.

The confusion over who owns what is largely attributed to actions taken by the United Nations (surprise surprise) some years ago. In 1982, the United Nations defined the “exclusive economic zone” for countries with maritime “frontiers” as extending 200 nautical miles from the countries’ coastline under the United Nations Convention on the Law of the Sea Part V, Article 55. While this has worked well enough for countries like the United States, which has relatively clear oceanic borders, nations located in more cluttered waters were faced with even more contentious, border-related issues.

As a result, nations were forced to engage in a race to define their borders to the most favorable position. This brought contentions and disagreements from neighboring countries; and the subsequent need for negotiations between a host of different nations soon evolved from these issues. Yet, true to form, the United Nations made no further effort toward clarification, and simply left the nations who were at odds with one another to their own devices.

Vietnam, of course, maintains that the blocks it has contracted for exploration are incontestably theirs under the UN Convention on the Law of the Sea. But so does China.

 

Regardless of Vietnam’s claims however, the Vietnamese government has claimed that their exploratory efforts have repeatedly come under harassment by Chinese naval boats. In fact, the Vietnamese government has even asserted that its oil exploration ships were damaged by Chinese boats.

Adding fuel to the fire, the Chinese media has engaged in some level of sabre-rattling over the oil and gas blocks as well. Recently the Chinese Global Times editorial page suggested that nations engaging in territorial disputes with China in the South China Sea region should “mentally prepare for the sounds of cannons” if they continue to do so.

At this point, one might be wondering how the U.S. might see itself involved in such a regionalized debate over oil and gas exploration between two (or more) Asian countries.

However, the last half of the above sentence should be enough give you a clue. The United States government has a lengthy history of supporting its oil companies (and virtually any other multinational corporation) and their investments. Major oil companies can, with confidence, depend on the United States government to summon the power of the United States military to defend both their current and future products, regardless of the harm it may do to the people who would suffer the consequences, Americans included.

As Smedley Butler wrote so many years ago, the United States has had a sordid history of doing just that . . . and it continues today.

For this reason, it is relatively easy to foresee a situation where ExxonMobil would be able to apply sufficient pressure on Washington to assist the company in protecting its assets in Vietnam.  Because the interests of ExxonMobil and the interests of Congress and the White House are largely one and the same, it is also relatively easy to foresee Washington caving in to the request.

The results of such intervention on the part of the United States would have disastrous implications for world peace.

Yet, if the American Corporatists firmly entrenched in the U.S. government were to move forward in assisting Big Oil in raping yet another third world country, the initial reaction is not likely to be a military one. At least not at first. Provoking China that close to home, however, is a terribly foolish move.

Considering the looming attack on Iran which, if Israel is to be involved, would likely engulf the world in a third great war, any further opportunities for conflict between the United States and China are very concerning to say the least.