Indonesia Approves Plan to Build Offshore Gas Field In Disputed South China Sea

A security ship crew of Indonesia's Ministry of Maritime Affairs and Fisheries prepares to anchor in Natuna during security patrols along Indonesia's exclusive economic zone, in Ranai, Indonesia, on Aug. 16, 2016. Ulet Ifansasti/Getty Images

Indonesia on Jan. 2 approved the initial plan to build the Tuna offshore gas field near its maritime border with Vietnam in the contested South China Sea, which will be used to export natural gas to Vietnam in 2026.

SKK Migas, the country’s upstream oil and gas regulator, said that the Tuna field will cost about $3.07 billion and is expected to produce at least 115 million standard cubic feet per day by 2027.

Indonesian Energy Minister Arifin Tasrif said last month that natural gas from the field, which Harbor Energy operates, will be exported to Vietnam beginning in 2026 at a rate of 100 to 150 million standard cubic feet per day.

Dwi Soetjipto, chairman of SKK Migas, said on Monday the project would underline Indonesia’s maritime entitlements in the disputed waters while also providing economic benefits to the country.

“There will be activity in the border area, which is one of the world’s geopolitical hot spots,” Dwi said.

“The Indonesian navy will also participate in securing the upstream oil and gas project so that economically and politically, it becomes an affirmation of Indonesia’s sovereignty,” he added.

The Tuna oil field, with around 100 million barrels of oil equivalent, was discovered by Harbor Energy in April 2014 near the Natuna Sea Block.

Indonesia considers the waters near its Natuna islands part of its exclusive economic zone (EEZ). Still, China’s claims to most of the South China Sea have affected its energy activities near the islands.

Indonesia-China Standoff

The tension between Indonesia and China over the disputed waters escalated after a fishing boat incident in 2016 when an Indonesian patrol ship intercepted a Chinese fishing boat near Natuna. An armed Chinese coast guard vessel entered the EEZ and freed the fishing boat.

In 2020, military and fishing vessels between China and Indonesia had more standoffs. Meanwhile, Indonesia had complained that Chinese research vessels increased their transit through Indonesian waters and suspected they dropped off drones to map the seabed for submarine warfare purposes.

The South China Sea is a global trade route with rich fishing grounds and energy reserves. The Chinese regime claims most of it based on its so-called “nine-dash line,” despite competing claims from Brunei, Indonesia, Taiwan, Vietnam, Malaysia, and the Philippines.

Southeast Asian countries, backed by the United States and much of the rest of the world, argued that the Chinese Communist Party’s (CCP) claims lacked a legal basis, but the CCP refused to agree and continued making incursions.

In recent years, the CCP has increased its aggression in the South China Sea with other Southeast Asian countries, including Vietnam in 2019.

Since April 2021, the tension between China and the Philippines has escalated, as hundreds of Chinese paramilitary vessels posing as fishing boats lingered in the waters near the disputed Whitsun Reef.

Alex Wu and Reuters contributed to this report.