Vietnam has reportedly terminated a gas-drilling expedition in the contested South China Sea, following threats from Beijing, as it embeds its grip on the region by opening a cinema on an island claimed by Hanoi.
Vietnamese diplomatic sources and an oil industry insider told the BBC that the Spanish-owned drilling company, Repsol, was forced to leave the area.
It was confirmed this month that a major gas field is below the water with some observers surprised at Hanoi’s immediate U-turn.
Days before the drilling began, General Fan Changlong, vice chairman of the Chinese Central Military Commission, cut short an official visit to Vietnam and a friendship meeting on the border was cancelled.
Repsol was apparently told last week by the Hanoi authorities that China had threatened to attack Vietnamese bases in the Spratly Islands if the drilling continued.
“We know they are unhappy again, but we are resisting the pressure – it is a traditional part of our relations with Beijing,” a government source in Hanoi told Reuters recently.
The drilling expedition began in June about 400km off Vietnam’s southeast coast.
Vietnam calls the area Block 136-03 and leased it to Talisman-Vietnam, a subsidiary of Repsol.
Talisman-Vietnam was formerly owned by Canada’s Talisman, but since 2015 has been part of Repsol.
China, however, calls the maritime zone Wanan Bei-21 and already leased it to a different, unnamed company.
In 2015, the Chinese rights were sold to a Hong Kong-listed firm called Brightoil, which has since denied ownership.
Two Brightoil directors are Chinese Communist Party chiefs.
One unnamed analyst estimated that Repsol had already spent about US$300 million on developing the field.
China, meanwhile, has opened a cinema on Woody Island, known as Yongxing in Chinese, in the Paracel Islands, state broadcaster CCTV reported.
In 2014 coastguard boats and other Chinese and Vietnamese vessels confronted each other near the Paracels.
Now the Yinlong Cinema has showed its first film, with 75 per cent of Woody’s population believed to be members of the military.
About 200 people reportedly watched The Eternity Of Jiao Yulu, a 2014 documentary about a provincial Communist Party secretary who it was said to have died of overwork in the 1960s. President Xi Jinping has dedicated a poem to the inspirational Jiao.
“There will be at least one film each day so military personnel and civilians living on the island can enjoy the same films and cultural entertainment as people elsewhere in China,” said Gu Xiaojing, the manager of Hainan Media Group, which owns the cinema chain, according to the state media. The Paracels are also claimed by Vietnam and Taiwan.
Woody, the largest island in the chain, has about 1,000 “residents” and the newly built city of Sansha, which administers the region.