“The main impact of the territorial and maritime disputes has been to block the development of new oil and gas resources in the majority of the South China Sea, particularly in what could be the more attractive deeper-water areas. These waters are increasingly accessible as new technology advances. However, despite journalistic hyperbole about the petroleum riches of the South China Sea, the reality is that most Western estimates of the region's oil and gas resource potential suggest relatively modest resources, not nearly large enough to alter Asia's deep dependence on oil and gas imported from outside the region. For example, the U.S. Geological Survey (USGS) estimates reserves of 11 billion barrels of oil and 190 trillion cubic feet of natural gas. For perspective, according to the BP Statistical Review, in 2014 the Asia-Pacific consumed 11.2 billion barrels of oil and 24 trillion cubic feet of natural gas. Moreover, the region is mainly natural gas-prone, rather than oil-prone , and gas exploration and production conditions there are extremely challenging and unfavorable. In sum, the overall potential for the South China Sea is probably relatively limited. However, Chinese sources make much higher estimates than the USGS, which could suggest a correspondingly higher level of interest in establishing sovereignty and jurisdiction, either officially or within a lobby of maritime actors.”
28 Jun 2016
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