China-Vietnam row hits energy groups Some of the world's biggest energy companies, including ExxonMobil and Gazprom, have been thrust into the deteriorating territorial dispute between China and Vietnam in the resource-rich South China Sea. Vietnam on Wednesday accused China of acting "illegally" after state-owned China National Offshore Oil Corporation (Cnooc) invited foreign companies to tender for exploration rights in an area that Hanoi says infringes on blocks that it has already licensed to America's ExxonMobil and Russia's Gazprom. Do Van Hau, chief executive of PetroVietnam, the state oil company, told reporters that nine exploration blocks put out for tender by Cnooc on Saturday were "located deeply within Vietnam's continental shelf." A government spokesman said that Cnooc's actions "seriously violated" Vietnam's sovereign rights and should be "immediately cancelled." After investing heavily in its naval capacity, China has become more assertive about its maritime claims in the last couple of years and Chinese vessels have clashed with Japanese, Philippine and Vietnamese ships in contested waters in the South China and East China Seas. Last month Cnooc launched its first deep-sea drilling project in the South China Sea, following domestic pressure on Beijing to uphold its territorial claims. China claims sovereignty over almost the entire South China Sea, which is believed to contain large oil and gas deposits and straddles significant global trade routes. The South China Sea is also claimed in whole or part by Brunei, Malaysia, the Philippines, Taiwan and Vietnam. Beijing's growing assertiveness has worried Washington, as well as China's neighbours, pushing the US to deepen its military and political relations with Vietnam, a former enemy, and the Philippines, a former colony. Analysts and diplomats said that Cnooc's move, which would have needed "sign-off" from the top leadership in Beijing, amounted to a further escalation of the long-running South China Sea dispute. This follows a recent stand-off between Chinese and Philippine vessels at Scarborough Shoal and a renewed war of words between Hanoi and Beijing. Stephanie Kleine-Ahlbrandt, a Beijing-based analyst at the International Crisis Group, a conflict monitoring group, said that tensions were being "raised to a new level." "This signals a change because Cnooc was unable to get approval before for exploration in so many disputed areas," she said. It certainly puts companies exploring in this area with interests in both countries in a very difficult position. Both ExxonMobil and Gazprom have significant business interests in China and Vietnam. China has pressed international oil companies, including BP and ExxonMobil, to withdraw from oil and gas exploration deals with Vietnam, according to industry executives and leaked American diplomatic cables. ExxonMobil said that "sovereignty is a matter only governments can address." Laban Yu, a Hong Kong-based oil and gas analyst at stockbroker Jeffries, wrote in a research note that Cnooc's bidding process had been "commandeered by China's Ministry of Foreign Affairs to use for political posturing" and that he expected international oil companies to steer clear of the Cnooc tender. Gazprom said that its projects in Vietnamese waters were not part of the disputed area, in line with Hanoi's official position. Hong Lei, a Chinese foreign ministry spokesman, said on Tuesday that Cnooc's moves amounted to "normal corporate activity" and he called on Hanoi to "immediately stop oil and gas activities that infringe on rights in relevant sea waters." Additional reporting by Catherine Belton in Moscow and Nguyen Phuong Linh in Hanoi