China Reform Monitor: No. 918

August 17:

China National Offshore Oil Corp. (CNOOC) will invest 46 billion RMB ($7.2 billion) to develop the nation’s first deep water natural gas field, Liwan 3-1, in the South China Sea, Ming Pao reports. The gas field, which is about 320 km southeast of Zhuhai, Guangdong, is located 1,500m below the surface and about 500km northeast of the disputed Paracel Islands, claimed by both China and Vietnam. The total estimated reserves are huge, at some 150 billion cubic meters. CNOOC expects to begin production within two years and estimates to eventually extract 20 billion cubic meters of natural gas per year. A construction site in Zhuhai will build drilling vessels and platforms, and other related equipment to support the project. Marine navigation control bases and fuel supply stations for vessels operating in the South China Sea will also be built.

[Editor’s Note: The reserves at Liwan 3-1 far exceed those of the disputed Chunxiao gas field which straddles the border between the Exclusive Economic Zones of Japan and China. Despite a 2008 agreement reached between Tokyo and Beijing on sharing profits from the project, China has begun drilling without Japan’s consent.]

August 22:

Due to the absence of tools and equipment, the multi-billion dollar Chinese-built Olorunsogo power plant in Nigeria has been forced to cut power generation to 83 megawatts from its capacity of 335 megawatts. The power plant, which was built five years ago, “could not work because the Chinese contractors refused to allow Nigerian engineers to acquire the technical information needed to operate it,” Acting Chief Executive Officer of the plant, Mohammed L. Almu, said in comments carried by Nigeria’s Daily Trust. He said only two out of the eight turbines were functioning because China’s SEPCO Electric Power Construction Corp. refused to make available the mandatory spare parts and the plant manuals were in Chinese. “Anytime we want to rub minds together, they refuse, some of them don’t even understand English,” Nigeria’s Power Minister said during a recent tour of the plant. “[China] actually built this plant on loan. They provided about 65 percent of the funds and Federal Government [of Nigeria] provided the balance.” He hinted that one reason the Chinese side has not been cooperative might be the Nigerian side’s delinquent loan repayment and because replacement tools were not mentioned in the initial contract.

August 24:

Along the China-Russia border in the Amur Oblast, Russian authorities have spent over $415,000 to install state-of-the-art radar and thermal imaging technology to detect Chinese illegally crossing into Russian territory. Unlike the old cameras, which only worked during daylight hours, the new equipment can detect intruders day and night, at a distance of 12 km and under any weather conditions. After an intruder is spotted an alarm is sent to a the seven-meter-high Rasskaz technical observation post and officers can move in to intercept within 5-15 minutes. The new installations are just the beginning of Russia’s full retooling of its China border security that includes replacing all the old equipment at border posts by 2020. Next year Russian authorities will begin replacing barbed wire with alarm sensors along the border with Heilongjiang, the government-owned Russian newspaper Rossiyskaya Gazeta reports.

August 26:

For the first time China’s Ministry of Public Security and the U.S. Federal Bureau of Investigation have conducted joint action targeting online criminals, cooperating to take down an organization running Chinese-language child pornography sites. About a year after Chinese and U.S. authorities agreed to work together to combat pedophile websites, the New York-based Sunshine Entertainment Alliance was shut down for operating at least 18 websites containing disturbing images of children. U.S. authorities have arrested a Chinese citizen in his New York home and Chinese police detained 10 suspects in China, reports the China Daily. The group allegedly made hundreds of thousands of dollars since 2007 by selling memberships that allowed individuals to post and download graphic images of children. Eighteen of the group’s 1,000 forums were dedicated to sexual images of children. In the U.S., the culprits face a minimum sentence of 15 years in prison.