intelligence and insight you can trust202.118.72.90/kuke/janes/20.pdf · natuna basin sunda shelf...

Intelligence and Insight You Can Trust

Copyright © 2011 IHS Inc. All Rights Reserved. 1


The South China Sea:

Energy exploitation,

territorial claims and

military capabilities


Disputes on the

surface: the

Paracel and

Spratly islands


Energy tensions

• Competing claims

• Harassment of survey ships

• Focal point for nationalist rhetoric


March 2009: USNS Impeccable

is shadowed and intercepted by

Chinese vessels.

EEZ disputes

April 2001: A US Navy EP-3 Aries II

electronic reconnaissance aircraft collides

with a PLA Navy J-8II.


Sea lines of communication in

the South China Sea

IHS Fairplay AISLive


Shipping up and down the South Chinese coast

IHS Fairplay AISLive


Geo-political conclusions

DigitalGlobe

Chengdu J-20

Ex-Varyag

• Increased Chinese belligerence

underwritten by military development

• SCS neighbours looking to US for support

and protection

• Chinese domestic pressures could force

Beijing‟s hand


South China Sea

Energy

Dylan Mair

Director, Far East Energy

• Claims

• Estimates

• Field Development

• UNCLOS, Treaties, Trade


Phu Khanh Basin

Reed Bank Basin

Khorat Swell

East Natuna Basin

Sunda Shelf

West Natuna Basin

Vung May Dalat High

SW Sarawak

Penyu Sub

Basin

China and US Estimates

Recovery factor: oil 25%, gas 70%

USGS estimates = 35 Bboe

• 11 billion barrels oil recoverable

• 300 trillion cu.ft gas recoverable

China estimates = 71 Bboe

• 50 billion barrels oil recoverable

• 210 trillion cu.ft gas recoverable

What is different? Maturity, study

area, input data, economics,

petroleum system risks


Proven & Possible,

Contingent Reserves

15 Bboe found

8.8 Bboe remaining

Baram Delta discoveries

• 1910-1987

• Onshore & shallow water

• 1988-2001

• Move out onto shelf

• 2002-2010

• Includes deep water

Borneo


Baram Delta contracts – with China claim

Malaysia

USA

Japan

Netherlands

Australia

Italy

Kuwait

Austria

France

Acreage scaled by % holding

Phu Khanh Basin

3 exploration wells, 2 since 2000

Well 124-CMT-1X:

• Proves the petroleum system

• Proves Miocene Carbonate Play

• 21m of net oil shows – not flow

Two companies recently

abandoned the basin

• one cited “lack of prospects”

Tuy Hoa 1X currently drilling

Miocene Carbonates

Potential Miocene Clastics

Potential Eocene-Oligocene Clastics

124-CMT-1X

Tuy Hoa 1X

Basin analogues helpful to

understand plays; less useful for

estimating volumes

• Play risks: trap integrity & charge


Spratly Islands

14

• Reed Bank Basin: 7 wells

• Dangerous Grounds: 0

• Truong Sa Basin: 3 wells

• Northwest Sabah Platform: 0

• NW Palawan Basin: coastal only

• NW Palawan Basin: coastal only

Sampaguita discovery (1976):

• “3 Tcf gas” 1.8 Tcf gas

(0.35 Bboe)

Risks: Source, Maturity, Reservoir

South China Sea

Ocean Floor

Reed Bank Basin

China ODP

Forum Energy


Field Development Challenges: Natuna Sea

Natuna D Alpha

• 46 Tcf gas (7.7 Bboe, 113 Tcf CO2

• Pipeline, FLNG, both, neither?


Offshore Rights Disputes

Contract overlap

Conflict

1. China vs Vietnam

seismic 2008

2. China vs Vietnam

seismic 2011

3. China vs Philippines,

/ Malaysia / Chinese

Taipei / Vietnam /

Brunei

4. China vs Japan 2011

5. Vietnam, China &

Malaysia

6. Malaysia & Indonesia

7. Thailand & Cambodia

8. Myanmar, India &

Bangladesh


UNCLOS (vastly simplified)

Legal resolution optional

• Territorial Waters 12nm

• Exclusive Economic Zone 200nm

• Continental Shelf to 350nm

• Islands – often mere „rocks‟

• Sustaining life? Above water?

Bilateral resolution

• Median lines

• Perpetuation lines

• Mutual arrangement

• Joint development

Uses

“Archipelagic

Baseline”


Bilateral Agreement – Joint Development

18

Malaysia-Thailand Joint Development

Authority

Joint Petroleum Development

Arrangement

PM3 Collaborative Agreement Area

Gulf of Tongkin

Japan-Korea Joint Development Zone

China-Japan Consensus

Joint Authority

1. Malaysia/Thailand JDA

2. Australia/Timor Leste JPDA

3. Korea/Japan JDA

Joint Rightholding

4. China/Vietnam Bipartite Coop.

5. Brunei/Malaysia CA-1 & CA-2

6. Malaysia/Vietnam PM-03 CAA

1

2

3

4

5 6


Gulf of Tongkin (Beibu Gulf)

China/Vietnam agreement

Based on median line

Exclusive but small Vietnam island

Oil & gas rights (bipartite

cooperation in red)

Joint fishing rights (blue)

Unilateral fishing control by China

Does not extend beyond the gulf

South China Sea Oil Trade

China needs long term access

Region benefits from China

0

100

200

300

400

2000 2010 2015 2020 2025

Saudi Arabia

Iran

Oman

Sudan

Kuwait

UAE

Iraq

MMboe exports Crude to China

0.00

1.00

2.00

3.00

2005 2006 2007 2008 2009 2010 2011

Indonesia

Malaysia

Australia

Vietnam

Thailand

$B exports Crude to China


Regional Actors in the South China Sea


Naval Base at Yalong Bay / Sanya, China

GeoEye


New Surface Combatants (2000-2011)

Destroyers • 2 x Luyang II

(Type 052C)

• 2 x Luyang I

(Type 052B)

Frigates • 4 x Jiangkai II

(Type 054A)

• 4 x Jiangwei II

(Type 053H3)

South Sea Fleet

Destroyers • 4 x Sovremenny

(Project 956E/956EM)

Frigates • 2 x Jiangkai II

(Type 054A)

• 2 x Jiangkai I

(Type 054)

• 2 x Jiangwei II

(Type 053H3)

East Sea Fleet

Destroyers • 2 x Luzhou

(Type 051C)

North Sea Fleet

50% 42%

8%


New Submarines (2000-2011)

SSG • 4 x Yuan

(Type 041)

• 2 x Song

(Type 039/039G)

• 4 x Kilo

(Project 877EKM/636)

SSN

• 2 x Shang

(Type 093)

SSBN

• 2 x Jin

(Type 094)

South Sea Fleet

SSG • 6 x Song

(Type 039/039G)

• 4 x Kilo

(Project 877EKM/636)

East Sea Fleet

SSG • 4 x Song

(Type 039/039G)

North Sea Fleet

50% 36%

14%


Naval Base at Zhanjiang, China

GeoEye


Chinese Civil Maritime Forces

14%

Central Military Commission

Ministry of Land Resources

State Oceanic Administration

China Marine Surveillance

(CMS)

Ministry of Agriculture

Fisheries Bureau Fisheries Law Enforcement

Command (FLEC)

Ministry of Transport

Maritime Safety Administration

(MSA)

People's Armed Police

China Coast Guard

General Administration

of Customs Customs Force


Vietnam naval and air bases

Da Nang

Phu Cat Airbase

Cam Ranh Bay


Phu Cat Air Base, Vietnam

aircraft

brake

parachute

GeoEye


Cam Rahn Naval Base, Vietnam

GeoEye


Da Nang Naval Patrol Facility, Vietnam

GeoEye


Tsoying Naval Base, Taiwan

DigitalGlobe DigitalGlobe


Naval Base at Teluk Sepangar, Brunei

GeoEye


Major Surface Combatants Submarines

South China Sea Fleet Comparisons

25

2 2

27 26

6

2 1


2 x Scorpene-class Commissioned 2009

Physical Characteristics Length Displacement (surface) Powerplant

67 metres 1,586 tonnes Diesel electric

Firepower Tubes Missiles Torpedoes

6 x 533 mm SM39 Exocet Black Shark

1 x Hamilton and Hero-class Transferred 2011 (first commissioned 1967)

Physical Characteristics

Length Displacement (full load) Helicopter Spots

115 metres 3,353 tonnes 1

Weaponry 1 x 76 mm/62

medium gun

2 x 25 mm/87

light gun

4 x 12.7 mm

machine guns

South China Sea Fleet Comparisons


What can we assess about state capabilities in SCS through IMINT?

• Activity seen in proximate bases

• Taking measures to build and conceal strategic

capabilities

• May not have active occupation of an island but still

strategic interest


Developments in the Paracel Islands


Woody Island (2005)

Occupied by:


Woody Island, 14 July 2011

Occupied by:

GeoEye



Occupied by:

Construction and

dredging barges at

new harbor

GeoEye



Occupied by:

Co

as

tal d

efe

nc

e p

os

itio

ns

Base HQ

Communications

facility

One of four large hangars

GeoEye


Developments in the Spratly Islands


Thitu Island

Sunken tanker

Control tower and

airfield operations

buildings

Local village

Occupied by:

GeoEye


Thitu Island

Occupied by:

New markings

delineate the

runway and

touchdown line GeoEye


Southwest, Northeast Cays

Occupied by: Occupied by:

Northeast Cay

Southwest Cay

GeoEye


Northeast Cay, 2005



Northeast Cay, 28 June 2011


GeoEye


Southwest Cay, 2005

Occupied by:


Southwest Cay, 28 June 2011

Occupied by:

GeoEye


Southwest Cay, 28 June 2011

Occupied by:

New land

reclamation

Coastal defense positions

50-metre cargo vessel offloading

onto pier

dredging

60m vessel

GeoEye


Namyit Island, 2006

Occupied by:


Namyit Island, 2010

Occupied by:

DigitalGlobe


Itu Aba Island - 2006

Occupied by:



Occupied by:

Partially obfuscated tractor-trailers on concrete

pads – vehicles may be truck-mounted

launchers

One of approximately fifteen coastal

defense positions visible on the island

Communications facility DigitalGlobe



Occupied by:

50m pier appears to have another

50m extension under construction


Subi Reef

Occupied by:

DigitalGlobe


Swallow Reef

Occupied by:

Secured

Hangars

at HLZ

Turbine

Communications

equipment at

enfenced facility GeoEye


What can we assess about Spratlys through IMINT?

• Increased establishment, activity on islands

• Chinese bases strategic, include air, naval,

intelligence gathering, communications

• Vietnamese construction extensive – air and harbour

• Taiwanese, Chinese, Vietnamese establishing coastal

defence positions: functional but unoccupied


0

5

10

15

Brunei Indonesia Vietnam Singapore Malaysia Philippines Taiwan

Southeast Asia / Taiwan: Defence Budgets

2010 2011 2012

0

50

100

150

200

250

2010 2011 2012 2013 2014 2015

China: Defence Budget

Source: Jane‟s Defence Budgets. (Figures beyond 2011 are based on forecasts.)


0

1

2

3

4

Brunei Indonesia Vietnam Singapore Malaysia Philippines Taiwan

Southeast Asia/Taiwan: Procurement Spending

2010 2011 2012 2013 2014 2015

0

10

20

30

40

50

60

2010 2011 2012 2013 2014 2015

China: Procurement Spending



0

0.5

1

1.5

2

2.5

2008 2009 2010 2011 2012 2013 2014 2015

Indonesia

0

1

2

3

4

2008 2009 2010 2011 2012 2013 2014 2015

Singapore

0

0.2

0.4

0.6

0.8

1

1.2

2008 2009 2010 2011 2012 2013 2014 2015

Malaysia

Procurement spending: by force

0

1

2

3

4

2008 2009 2010 2011 2012 2013 2014 2015

Taiwan

0

0.1

0.2

0.3

0.4

0.5

2008 2009 2010 2011 2012 2013 2014 2015

Philippines

Air Force Navy Army Defence-wide

0

0.5

1

1.5

2008 2009 2010 2011 2012 2013 2014 2015

Vietnam



Air Force Navy Army Defence-wide

China procurement spending: by force


0

10

20

30

40

50

60

2008 2009 2010 2011 2012 2013 2014 2015


China: Procurement Plans

Air: multirole combat; naval multirole fighters; airborne

early warning and control; tankers; transport/attack

helicopters; medium/large transports; trainers;

Sea: aircraft carriers; landing helicopter dock,

replenishment ships; submarines; frigates; destroyers

C4ISR + Missile development

Source: IHS Jane‟s


Southeast Asia: Procurement Plans

Air: multirole combat; trainers/light fighters medium/large

tactical transports; multirole/attack helicopters;

Sea: submarines; anti-submarine warfare; frigates; offshore

patrol vessels; amphibious warfare ships; auxiliary ships;

fast attack craft



Taiwan: Procurement Plans

Air: Combat fighters; F-16 midlife upgrades; trainers; P-3C

Orion ASW/maritime patrol; utility helicopters;

Indigenous Defence Fighter upgrades; attack

helicopters; light/tactical transports; tanker

Sea: fast attack craft; offshore/coastal patrol vessels;

submarines



Thank you

James Hardy, Asia Pacific Editor, IHS Jane's Defence Weekly

[email protected]

Dylan Mair, Regional Director, CID Asia-Pacific

[email protected]

Alexander von Rosenbach, Editor, IHS Jane’s Armed Forces

[email protected]

Allison Puccioni, IHS Jane’s Image Analyst

[email protected]

Jon Grevatt, IHS Jane’s Industry Asia-Pacific Reporter,

[email protected]

Sarah McDowall, IHS Country Risk analyst

[email protected]

Maria Patrikainen, IHS Country Risk analyst

[email protected]

Bouko De Groot, IHS Fairplay Content Manager – China

[email protected]

mailto:[email protected]








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