Thayer Consultancy Background Briefing:

ABN # 65 648 097 123

South China Sea: Malaysian
Unilateralism in the Joint
Defined Area
Carlyle A. Thayer
April 11, 2020
Vietnam and Malaysia submitted a joint submission to the CLCS in 2009 to extend their
continental shelves. What is your assessment of alleged recent Malaysian unilateral
oil and gas exploration in the Joint Defined Area?
ANSWER: Vietnam and Malaysia agreed to a Joint Defined Area (JDA) in their 2009
joint submission to the UN Commission on the Limits of the Continental Shelf (CLCS).
On December 12, 2019, Malaysia lodged a partial submission for an extended
continental shelf in the northern area of the South China Sea with the UN
Commission on the Limits of the Continental Shelf. The area that Malaysia claimed
partly overlapped with Vietnam’s 2009 claimed extended continental shelf (see map
below). And, as will be noted below, Malaysia has undertaken hydrocarbon
exploration in this area.
Malaysia’s submission made clear that ‘it shall not be interpreted in any manner
whatsoever to prejudice or affect matters relating to the delimitation of maritime
boundaries in the South China Sea between States with opposite or adjacent coasts
and their position concerning land and maritime disputes’.
On 12 December 2019, immediately after Malaysia filed its partial submission to the
UN CLCS, China lodged a Note Verbale claiming sovereignty over the Nanhai Zhudao
(certain waters in the South China Sea) and formally requested ‘the Commission not
to consider the Submission of Malaysia’.
Although Vietnam mentioned Malaysia’s partial submission to the CLCS in its Note
Verbale to the CLCS dated 30 March 2020, the Note Verbale was entirely focused on
China.
Malaysia’s Exploration Activities in the JDA
In 2018, Seadrill Partners LLC signed a five-well contract (with options) with Sabah
Shell Petroleum Ltd. for their drillship West Capella (pictured below) to operate in
waters off East Malaysia (SK 318). When this contract expired Seadrill Partners LLC
signed a contract with Petronas out to the year 2020.
 2

SOURCE: Nguyen Hong Thao, The Diplomat, December 21,

2019, https://thediplomat.com/2019/12/malaysias-new-
game-in-the-south-china-sea/.
 3

According to research conducted by the Asia Maritime Transparency Initiative, based

on tracking the movements of the West Capella through its Automatic Identification
System (AIS):
• In October 2019, the West Capella began
operations in oil and gas block ND4 in
waters off Sabah in Malaysia’s EEZ (see
map below);
• On 21 December 2019, the West Capella
moved to block ND2, beyond Malaysia’s
200 nm Exclusive Economic Zone, but in
the JDA;
• On 12 January 2020, the West Capella
sailed east to a new location in block ND2, outside the JDA;
• On 20 January 2020, the West Capella shifted operations to block ND1, well within
the JDA;
• As of 15 February 2020, the West Capella was still operating in block ND1.
It is assumed by analysts that the West Capella was engaged in drilling and not less
invasive marine surveys.
Responses by China and Vietnam
China responded to the West Capella’s exploration activities by dispatching several
China Coast Guard (CCG) vessels (nos. 5202, 5203, 5305, and 5403) who monitored
and regularly harassed the West Capella and its supply ships from December 2019-
February 2020. The CCG vessels replenished at Fiery Cross Reef before returning to
duty.
During this period, Malaysia dispatched two Royal Malaysian Navy ships to provide a
naval presence for the West Capella and its offshore supply vessels. For example, the
KD Jebat, a guided missikle frigate, was dispatched to block ND2 in early January, and
the KD Kelantan, an Offshore Patrol Vessel, took up station at the end of the month.
In February, the Malaysian Maritime Enforcement Agency’s KM Bagan Datuk, a Patrol
Vessel, deployed twice to ND1 in February.
Vietnam’s actions were more circumspect. Two Vietnamese 40-metre fishing boats,
presumed to be maritime militia, were identified by satellite imagery in January in the
JDA, presumably monitoring the situation.
Assessment
As far as the public record shows, Malaysia has not explained the timing of and why it
initiated unilateral oil and gas exploration activities in the Joint Defined Area without
prior consultation with Vietnam.
On 28 August 2019, Prime Minister Nguyen Xuan Phuc and Prime Minister Mahathir
Mohamad stated at a joint press conference in Hanoi that they would encourage their
national oil companies, Petronas and Petro Vietnam, to expand exploration and
exploitation activities and create favourable conditions for their fishermen to conduct
fishing activities in a legal, safe and sustainable manner’. Four months later Malaysia
unilaterally began conducting oil exploration in block ND2 inside the JDA.
 4

SOURCE: Asia Maritime Transparency

Initiative (AMTI), February 21, 2020.
https://amti.csis.org/malaysia-picks-a-
three-way-fight-in-the-south-china-
sea/.
Nor has Malaysia been forthcoming about the timing and motivations for its claim for
an extended continental shelf in the northern Spratlys that partly overlaps with
Vietnam’s claim for an extended continental shelf. Vietnam has been unusually silent
on these issues. Analysts, therefore, have been forced to speculate about Malaysia’s
motivations:
First, in 2019 two incidents caused tensions to rise in the South China Sea. The first
was China’s four-month confrontation with Vietnam about hydrocarbon exploration
activities in waters near Vanguard Bank (July-October). The second was a
confrontation between China and Indonesia about the activities of Chinese fishermen
operating in Indonesia’s EEZ around Natuna island in late 2019. In these
circumstances, so the argument goes, Malaysia decided to exercise its legal right to
claim an extended continental shelf by officially putting it on record.
Second, Malaysia wanted to put its claim to an extended continental shelf on record
in advance of any agreement between ASEAN member states and China on a legally
binding Code of Conduct (COC) in the South China Sea. The current Single Draft
Negotiating Text lacks any definition of the South China Sea and disputed waters. In
2018, Malaysia’s submission to the COC Negotiating Text proposed, ‘depending on the
operative elements/contents of the COC, the geographic scope/scope of application
 5

may have to be defined’. Malaysia’s submission also argued with respect to exploiting
marine resources that nothing in the COC ‘shall affect… rights or ability of the Parties
to conduct activities with foreign countries or private entities of their own choosing’.
Third, Malaysia’s partial submission and its ‘without prejudice’ clauses are an open
invitation to other claimants – the Philippines and Vietnam – to enter into bi- or tri-
lateral discussions to reach agreement on delimiting disputed areas. This would
strengthen the legal position of all three parties in dealing with China because they all
accept the Arbitral Tribunal award ruling that China’s nine-dash line and historic rights
claim are illegal under international law.
Fourth, as James Patterson of Reuters reported, Malaysia’s partial submission may
have been aimed at laying the basis for a legal claim against China under Annex VII of
the United Nations Convention the Law of the Sea along the precedent set by the
Philippines. Malaysia could point to China’s harassment in its EEZ (including around
Luconia breakers, not discussed in this brief) and ask an arbitral tribunal to determine
its entitlements under UNCLOS.

Suggested citation: Carlyle A. Thayer, “South China Sea: Malaysian Unilateralism in the
Joint Defined Area,” Thayer Consultancy Background Brief, April 11, 2020. All
background briefs are posted on Scribd.com (search for Thayer). To remove yourself
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