Asia’s 21st Century ‘Pax ASEAN-Ameri-China’

The result: a multi-generationally useful Asian 'internet' of energy.

Consider current developments.

Undeniably, there's dangerous tension in the South China Sea. The media, as they do, plays this up with head-butting headlines focusing on water cannon fights, surreptitious island building and flotilla-accompanied oil exploration rigs.

A less sexy, less reported parallel reality is that Vietnam, China and the Philippines already cooperate in the South China in constructive, precedent-setting ways.

In the Tonkin Gulf, China and Vietnam now cooperatively manage fisheries. China and Vietnam are jointly exploring for oil and gas on either side of their jointly-acknowledged Tonkin Gulf offshore territorial equi-distance line.

Meanwhile, Philippine energy explorer Philex is talking with China National Offshore Oil Corporation (CNOOC) about joint exploration of the hot-button Reed Bank. This is occurring with the apparent acquiescence of the Philippine government.

Grenatec proposes the nine new JDAs be established in four geographic zones. These are north of Indonesia's Natuna Island; in the eastern offshore waters of Vietnam and in the Tonkin Gulf, off Southern China southeast of Hong Kong and southwest of Taiwan; and in the Scarborough Shoal and Reed Bank areas west of the Philippine islands of Luzon and Palawan.

Proceeds of JDA auctions would be recycled into access infrastructure. Initially, this would be a Pan-Asian Gas Pipeline. This would run along the eastern and later the western sides of the South China Sea from Singapore to southern China. Spurs would connect this mainline to individual JDAs.

The basic idea has been around for years. The most detailed template is the moribund Trans-ASEAN Gas Pipeline conceived by ASEAN's Council on Petroleum. It's been shelved due to ASEAN dithering.

Private industry concepts akin to a Pan-Asian Gas Pipeline include the Malaysian private-industry proposed Trans-Asian Oil and Gas Grid and its intellectual precursor, the Asian Gas Grid.

Oil and gas exploration auctions have become common, as have auctions of wireless telecommunications spectrum. Both allocate scarce, contested resources to those willing to pay the most.

In the case of South China Sea JDAs, auction proceeds could be recycled through -- among others -- the Asian Development Bank or new-kid-on-the-block China's Asian Infrastructure Investment Bank (AIIB). Roughly half the AIIB's founding members are ASEAN countries. The South China Sea represents a key part China's Xi Jinping's One Belt, One Road vision.