China, Japan and the Energy Quest in the East China Sea
Photo Credit: Xinhua
By Amrita Jash

China, Japan and the Energy Quest in the East China Sea

Aug. 29, 2017  |     |  0 comments

In early August 2017, Japan lodged a protest with China over its gas exploration in a disputed area of the East China Sea. Confirming the presence of a Chinese drillship close to Tokyo’s proposed median line, Japan accused China of conducting “unilateral development in the area” which remains yet to be demarcated between the two countries.

In its defence against Tokyo’s accusations, Beijing categorically pointed out that its oil and gas activities in the maritime areas in the East China Sea fall “indisputably under China’s jurisdiction,” and most importantly stated that: “The so-called issue of ‘unilateral exploitation’ does not exist.” In 2016, Japan had accused China of deploying a radar system on one of its oil platforms in the East China Sea. Japan views such activities as a breach of the 2008 agreement it signed with China on their joint exploration of resources near their disputed continental shelf.

The 2008 consensus states that “both sides will, through joint exploration, select sites for joint development by mutual agreement and conduct joint development at the sites based on the principle of mutual benefit. Details will be decided by the both sides through consultation.” Here, the selected sites are mainly in the 2,700 square kilometres that extend over the median line proposed by Japan, and includes the Chunxiao/Shirakaba oil and gas field. This suggests the failure of the 2008 consensus as both China and Japan are at loggerheads on the very question of “exploration of resources,” and thus have pushed the envelope of the dispute to new extremes.

The East China Sea remains a core factor of inter-state tensions between China and Japan. With time, the dispute has evolved and has taken centre stage in the fragile relationship. What caused this divide between China and Japan? Conventionally, the divide exists along contested sovereignty over the Diaoyu/Senkaku islands and the overlapping Exclusive Economic Zones (EEZs) arising from the maritime border claims.

However, the unresolved “exploration question” significantly adds to the increasing assertive behavior of China and Japan in the disputed sea. Beijing has ramped up its military activities via coastguard vessels and armed navy frigates. Concomitantly, Japan too has increased the presence of its coast guard and Maritime Self-Defence Force. To add, both sides are involved in frequent jet scrambles.

These activities to safeguard one’s territorial and maritime interests are largely driven by the sense of insecurity which is exacerbated by the quest for energy security. With increasing economic growth and development, energy needs have skyrocketed while energy supplies have dropped. In this regard, the East China Sea acts as a potent source of energy reserves.

What makes the “energy quest” a trigger point to the dispute is the very fact that the tension over the competing claims came into existence only after a geological survey of the East China Sea conducted under the auspices of the Committee for Co-ordination of Joint Prospecting for Mineral Resources in Asian Offshore Areas of the United Nations Economic Commission for Asia and the Far East in October-November 1969 reported promising signs of oil reserves in the sea around the Diaoyu/Senkaku islands.

Although the energy dimension in the East China Sea dispute is benign as compared to the sentiments over sovereignty and maritime rights, the increasing competition between China and Japan over securing hydrocarbon reserves is hard to overlook.

Both China and Japan are energy starved and have strong demand. China’s surging energy demands have made the country the world’s largest net importer of crude oil, while Japan has been perennially an oil importer and ranks as the world’s largest liquefied natural gas importer. Given these interests attached, the East China Sea dispute has been driven by the calculated interests of both sides. These material forces have further compounded their assertive behavior and hard-line positions.

The turning point in the dispute was the 2010 collision between a Chinese fishing boat and a Japanese patrol boat in waters surrounding the disputed islands. This incident led to the collapse of the meeting that had aimed at resolving overlapping claims to natural-gas deposits in the area. The tensions subsequently ratcheted with Japan’s nationalization of the Diaoyu/Senkaku islands in 2012. In response to this, Beijing unilaterally established an Air Defence Identification Zone (ADIZ) over the Diaoyu/Senkaku islands in 2013. These events highlight how friction on overlapping EEZ claims to the hydrocarbon reserves arises from both countries’ competition in the exploration and securing of oil and gas.

It should be noted that the 1982 UN Convention on the Law of the Sea offers conflicting instructions as to who is entitled to energy rights in the region, giving both sides a claim based on how they define their EEZs. China argues that its zone extends to the edge of the continental shelf, while Japan says that it should stop at the midpoint between the two nations. In its energy quest, since mid-2013 through 2015, China had built several new drilling platforms on its side of the median line. While none of these platforms fell within the agreed-upon joint development zone, Tokyo objected that they nonetheless violated the 2008 consensus on China’s unilateral oil and gas exploration activities, including those in the Chunxiao/Shirakaba field.

Although the energy dimension in the East China Sea dispute is benign as compared to the sentiments over sovereignty and maritime rights, the increasing competition between China and Japan over securing hydrocarbon reserves is hard to overlook. Though the energy resources have not yet proved to be provocative enough to call for military confrontation, the vitality of the quest for resources to meet the countries’ energy demands makes it a potent point of friction.

What can thus be argued is that the energy resources have added a competitive dimension to the dispute, but the possible evolution of this into a military conflict should continue to be carefully watched. So far, the militarization of the sea by China and Japan is mainly linked to the safeguarding of their territorial and maritime interests. However, energy resources fall within these overlapping zones. Hence, how long the energy question will remain benign remains a long-term concern. Without a doubt, the ongoing energy quest in the East China Sea is a potential tipping point between China and Japan.

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