Oil exploitation of the East China Sea is one of several complicated issues between Japan and China stemming from Sino-Japanese territorial disputes over the Diaoyu Islands. Although a tentative agreement about oil exploitation in the East China Sea has been reached by Beijing and Tokyo, the sovereignty of the Diaoyu Islands is still unresolved.

China’s exploitation of oil in the East China Sea has been complicated by a Sino-Japanese territorial issue—sovereignty over the Diaoyu Islands (known in Japan as the Senkaku Islands).

The Diaoyu Islands are located about 193 kilometers northeast of Taiwan, approximately 289 kilometers west of Okinawa, Japan, and approximately 402 kilometers east of China’s mainland. The islands are made up of eight uninhabited islets, including three barren rocks, which are claimed by China (People’s Republic of China or PRC), Taiwan (Republic of China or ROC), and Japan. Currently Japan controls the islands, which officially are under the jurisdiction of Ishigaki city of Okinawa Prefecture. Until 1968 the Diaoyu Islands were essentially worthless to China and Japan, and neither country appreciated their value. However, that changed after the Committee for Co-ordination of Joint Prospecting for Mineral Resources in Asian Offshore Areas, under the auspices of the United Nations Economic Commission for Asia and the Far East (ECAFE), reported substantial energy deposits under the East China Sea.

Based on a geological survey, experts estimated that the continental shelf surrounding the Diaoyu Islands contains 10–100 billion barrels of oil. As of 2008 neither China nor Japan has actually drilled in the disputed area as they make overlapping claims to the islands and their surrounding waters. Nor has an international solution been possible. Neither country is willing to submit the dispute to the International Court of Justice. In the current debate two competing views have emerged: A pro-China group emphasizes the use of historical evidence from the archives of the Ming (1368–1644) and Qing (1644–1912) dynasties. A pro-Japan group emphasizes the “discovery” theory in international law, arguing that the Japanese “rediscovered” the islands in 1884 as terra nullius (i.e., unadministered territory or no-man’s-land). In reality, the Diaoyu Islands have become “hostage” to the disputing parties, Japan and China, since the 1970s.

On 28 May 2004 the Japanese media dropped a bombshell on already shaky Sino-Japanese relations. The media reported that, starting in August 2003, China began to develop a natural gas field exploration project in the East China Sea—the Chunxiao oil and gas fields. The Japanese government worries that this drilling will enable China to siphon off the 1.6 trillion cubic feet of natural gas buried under China’s side of the disputed islands. Thus, the Chunxiao oil and gas fields loom as another bone of contention between Tokyo and Beijing.

Starting in May 2004, Japan and China held several rounds of bureau-chief-level talks and occasional informal negotiations in Beijing and Tokyo. Finally, on 18 June, two superpowers in the East Asian region finally settled the oil/gas development situation in eastern China. Two major points in this agreement:

1 both countries agreed to explore jointly a 2,700-square-kilometer area south of the Longjing oil field, stretching across the Japanese-claimed median line.

2 regarding the Chunxiao gas field, which the Chinese have already operated for years, Beijing welcomed investment by Japanese corporations in the project in accordance with Chinese laws.

However, the sovereignty issue of the Diaoyu/Senkaku Islands and the demarcation of the international boundary in the East China Sea, such as the Japanese-claimed median line and the Chinese-claimed natural prolongation line, were not addressed by this agreement.

Basically China claims sovereignty over the area of the Chunxiao oil and gas fields, which are located immediately outside the median line or the exclusive economic zone (EEZ) claimed by Japan, and has rejected Japanese requests to hand over all data about Chunxiao and to suspend drilling. Even though China proposed joint development of the disputed territory, Japan insists that it has sovereignty over the Diaoyu Islands and refuses the joint development proposal. However, Japan proposed joint development of four oil fields—Chunxiao, Duanqiao, Tianwaitian, and Longjing—which are only 10 kilometers northeast of the Diaoyu Islands. China rejected this proposal. As the Japanese government argues, one of the four oil fields crosses the median line claimed by Japan, and the remaining three are completely inside Japan’s EEZ. Yet, Beijing has refused to accept the median line set by Tokyo. Instead China has argued that its EEZ extends to the far reaches of its continental shelf, which ends west of Okinawa Prefecture. Hence, the Japanese and Chinese claims of sovereignty overlap over a large area in the East China Sea. During the fourth round of talks Beijing proposed joint development of the Longjing field, but Tokyo did not accept. Furthermore, in 2005 the Japanese government granted Teikoku Oil Co. the right to perform exploratory oil drilling in an area opposite the Chunxiao oil and gas fields.

In early 2007, after a Chinese surveillance ship was detected about 32 kilometers from the islands, territorial disputes escalated; later that year Japan formally protested China’s gas exploration in the contentious EEZ area. At landmark summit talks in Tokyo in May 2008 Chinese president Hu Jingtao and Japanese president Yasuo Fukuda signed a deal that agreed to establish a “new starting point” in relations between the two nations; settling the disputes over gas deposits in the East China sea was one of their priorities. But efforts to resolve this issue have yet to be successful and continue to complicate the nations’ other negotiations. In December 2008, shortly before Japan, China, and South Korea were scheduled to participate in an economic summit in the Japanese city of Fukuoka, Japan accused China of sending research ships to visit the Diaoyu/Senkaku Islands, and called the alleged violations “extremely regrettable.”

Further Reading

Annual Report. (2008). Retrieved December 8, 2008, from http:www.uscc.govannual_report2008chapter4_section_2_part2.pdf

Asian powers edging toward an energy war. (2005, October 1). Edmonton Journal, 3.

Downs, E. S., & Saunders, P. C. (1998–1999, Winter). Legitimacy and the limits of nationalism: China and the Diaoyu Islands. International Security, 23(3), 124.

Suganuma, U. (2000). Sovereign rights and territorial space in Sino-Japanese relations: Irredentism and the DiaoyuSenkaku Islands. Honolulu: University of Hawaii Press and Association of Asian Studies.

Suganuma, U. (2007). The DiaoyuSenkaku Islands, 1993–2006: A hotbed for a hot war? In J. C. Hsiung (Ed.), China and Japan at odds (pp. 155–172). New York: Palgrave Macmillan.

Suganuma, U. (2007). Zhongri Guanxi yu Lingtu Zhuquan [History of Sino-Japanese relations: Sovereignty and territory]. Tokyo: Nihon Kyohosha.

Source: The Editors. (2009). East China Sea Oil Exploitation. In Linsun Cheng, et al. (Eds.), Berkshire Encyclopedia of China, pp. 666–667. Great Barrington, MA: Berkshire Publishing.

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