ExxonMobil Plans Vietnam Drilling

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Risking objections from China, ExxonMobil, the largest U.S. oil company, is moving forward with plans for a drilling project in the South China Sea off the coast of Vietnam. The Chinese government, which has laid claim to all of the South China Sea, has previously objected to similar plans by other oil producers.

Dow component Exxon (XOM) is planning a project at at ''Block 119'' off Danang city and the adjacent Quang Ngai province, the Vietnam News reported, but what is not clear at this juncture is if the block is located in waters that both Vietnam and China claim. Beijing previously warned Exxon about drilling in a nearby area in 2008.

PetroVietnam, the country's state-run oil producer, and foreign partners have active projects in the South China Sea in areas that are not under dispute. The U.S. Department of Defense has said it objects to Beijing's efforts to intimidate U.S. firms looking to work in the South China Sea.

The Philippines, Brunei, Malaysia and Taiwan are other claimants to areas of the South China Sea, the AFP reported. Texas-based Exxon did not comment on the Vietnam News report, according to the AFP.