Philippines suspends oil, gas exploration in disputed South China Sea region



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MANILA, Philippines — The Philippine government has ordered the suspension of all exploration at an offshore oil and gas field because of an ongoing territorial dispute with China, a Filipino-British company said.

Oil and gas exploration company Forum Energy Plc. said the Department of Energy instructed it to halt all work in its contracted area at Reed Bank in the South China Sea off the western Philippine province of Palawan.

The Energy Department issued the order because the area "falls within the territorial disputed area of the West Philippine Sea which is the subject of a United Nations arbitration process between the Republic of the Philippines and People's Republic of China," it said in a statement Monday.

Philex Petroleum Corp. owns 60.49 percent of Forum Energy, which has a 70 percent participating interest in the field. Philex chairman Manny Pangilinan said last year that the project has not attracted other investors because of concerns about offending China.

The territorial dispute between the Philippines and China, which claims vast areas of the South China Sea, has been escalating in recent years. In 2013, Manila challenged China's claim at an international tribunal in The Hague, angering Beijing.

Last year, President Benigno Aquino III expressed concern that two Chinese hydrographic ships sighted at disputed Reed Bank could be followed by an attempt to drill for oil there.

In March 2011, Chinese ships tried to drive away a Philippine exploration vessel at Reed Bank. The Philippines deployed two air force planes but the Chinese patrol ships had left by the time the aircraft reached the contested area.

The Philippines also has filed diplomatic protests over Chinese land reclamation at several reefs in the region which resulted in the creation of new islands.

Last week, Chinese Foreign Ministry spokesman Hong Lei defended China's activities in the region as "reasonable, legitimate and legal" and said it has exercised "restraint and responsibility."

Vietnam, Malaysia, Taiwan and Brunei also claim parts of the South China Sea.

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