UPDATE 1-U.S. State Dept says concerned by reports of Chinese interference in South China Sea

(Adds details from State Department statement and on tensions
in the South China Sea)
By Nandita Bose
WASHINGTON, July 20 (Reuters) - The U.S. State Department
said on Saturday it is concerned by reports of China's
interference with oil and gas activities in the South China Sea,
including Vietnam's long-standing exploration and production
activities.
"China's repeated provocative actions aimed at the offshore
oil and gas development of other claimant states threatens
regional energy security and undermines the free and open
Indo-Pacific energy market," the State Department said in a
statement.
Vietnam on Friday accused a Chinese oil survey vessel and
its escorts of violating its sovereignty and demanded that China
remove the ships from Vietnamese waters.
Vietnam and China have for years long been embroiled in a
dispute over the potentially energy-rich stretch of waters in
the South China Sea.
On Wednesday, two U.S.-based think tanks reported that
Chinese and Vietnamese vessels had engaged in a standoff lasting
several weeks near an oil block in Vietnam's exclusive economic
zone. Neither Beijing nor Hanoi have directly confirmed or
denied the reports. "The United States firmly opposes coercion and intimidation
by any claimant to assert its territorial or maritime claims,"
the State Department said.
"China should cease its bullying behavior and refrain from
engaging in this type of provocative and destabilizing
activity," it added.
The State Department also pointed to Secretary of State Mike
Pompeo's comments earlier this year when he said, "by blocking
development in the South China Sea through coercive means, China
prevents ASEAN members from accessing more than $2.5 trillion in
recoverable energy reserves."
The State Department also said that China's growing pressure
on ASEAN countries to accept provisions that seek to restrict
their right to partner with third party companies or countries
further reveal its intent to assert control over oil and gas
resources in the South China Sea.
"China's reclamation and militarization of disputed outposts
in the South China Sea...including the use of maritime militia
to intimidate, coerce, and threaten other nations, undermine the
peace and security of the region," it said.