China suddenly withdrew its controversial oil rig from Vietnamese waters ahead of schedule. Beijing says the rig did its job -- and it may have, in more ways than one.
NOTE: This story was updated Wednesday afternoon.
More than two months after China sparked a regional crisis with the dispatch of a billion-dollar deep-water oil rig to waters claimed by Vietnam, Beijing announced that the rig had finished its work ahead of schedule and was heading back to China.
The big question now is: What does this really mean?
Opinions are divided on how to read the move — as unexpected as the initial placement of the rig in disputed waters in early May — but few outside observers believe Beijing is ultimately backing down from its aggressive claims of maritime rights in the South China Sea. Indeed, the fact that foreign ministry officials said the move had been made for commercial reasons, reiterated their claims to the disputed waters, and left the door open for the rig to return suggests that the maritime battles between China and its neighbors are far from over.
Indeed, Vietnamese officials warned China Wednesday not to send any more rigs or to repeat what Hanoi believes are violations of its exclusive economic zone, which extends 200 miles off the coast. Last week, Vietnam’s foreign ministry again demanded the withdrawal of the rig and on Wednesday reaffirmed the country’s claims to the disputed Paracel Islands.
For the moment, China is ignoring Hanoi’s demands and painting the rig’s relocation as a purely commercial move.
Early Wednesday, the two Chinese firms operating the rig said that they had finished drilling two exploratory wells in waters not far from the disputed Paracel Islands, about 120 nautical miles off the coast of Vietnam. The firms, China National Petroleum Corporation (CNPC) and China Oilfield Services Limited, said that the rig found some oil and gas prospects in the region, and was withdrawn ahead of the arrival of a typhoon. The companies had earlier said that the rig would operate until the end of the good weather season in mid-August.
Many Chinese users of Weibo, a Twitter-like microblogging service, criticized the withdrawal, Reuters reported, suggesting that Beijing had backed down to pressure from the United States and others. But Chinese Foreign Ministry spokesman Hong Lei told reporters the rig’s withdrawal was a purely commercial decision.
"The oil rig is relocated in accordance with the relevant company’s plan of operation at sea. It has nothing to do with any external factor," he said.
The United States "welcomes" news of the rig’s withdrawal, State Department spokesperson Jen Psaki said at a briefing Wednesday, but she said she would not speculate on the reasons that drove Beijing to retire the rig ahead of schedule. She added that Secretary of State John Kerry had last week reiterated U.S. concerns with Chinese actions in the region, "and those have not all been addressed."
CNPC, meanwhile, said that it would study the geological data from the two wells and then decide on its next steps for the project, leaving the door open for a replay of the contentious deep-water operation, which has led to numerous low-intensity skirmishes between Chinese and Vietnamese coast guard vessels since May.
"The big question is whether the rig returns next year or not," said M. Taylor Fravel, an expert on Chinese maritime claims at the Massachusetts Institute of Technology.
Most observers accept at least part of the official Chinese explanation. The typhoon clearly played a part in the redeployment of the expensive rig, which Chinese officials have for years viewed as a strategic, rather than a purely commercial, tool. And it’s entirely possible that the rig finished drilling the exploratory wells ahead of schedule thanks to favorable weather earlier this summer.
Beyond that, there are several other possibilities. China may have felt that it sufficiently made its point by dispatching a rig to disputed waters and successfully operating it despite vehement protests and limited tactical responses from Vietnam and others. The United States, for example, repeatedly denounced Chinese actions as "provocative," but did not seek to force the issue.
Or China may have decided to throttle back the controversial operation in light of the blowback it sparked around the region. Massive anti-Chinese riots gripped Vietnam in the days after the rig’s placement. The Philippines, Japan, and Australia have all announced closer defense ties with the United States, in part because of China’s aggressive and sweeping claims to big chunks of the South China Sea. The United States and Japan pointedly took issue with China’s maritime grabs at a regional security meeting in May. And the issue topped the agenda for U.S. diplomats in Beijing last week at a big strategic summit with Chinese counterparts.
"Of course, moving the rig does not mean that China is backing down. However, it is clear that China underestimated the Vietnamese and international reaction to the deployment of the rig," Fravel said. "As a result, an earlier-than-scheduled withdrawal of the rig, from a tactical perspective, might be undertaken to reduce focus on the issue."