The US has put China National Offshore Oil Corporation on a blacklist that will make it extremely hard for American companies to export equipment or technology to the state-controlled oil producer.
Wilbur Ross, US commerce secretary, said in a statement that Cnooc acted as “a bully” for the Chinese military to help intimidate China’s neighbours.
The commerce department said Cnooc had “repeatedly harassed and threatened offshore oil and gas exploration and extraction” in the South China Sea in order to raise political risk, including for Vietnam, which has a longstanding dispute with China over oil resources.
“China’s reckless and belligerent actions in the South China Sea and its aggressive push to acquire sensitive intellectual property and technology for its militarisation efforts are a threat to US national security and the security of the international community,” said Mr Ross.
Chinese president Xi Jinping in 2015 promised then US president Barack Obama that China would not militarise disputed areas in the South China Sea despite its efforts to reclaim land for construction.
The commerce department put Cnooc on the “entity list”, a move that requires US companies to seek a licence to export to the company but with the expectation that permission will be exceptionally hard to receive.
Over the past couple of years, it has put other Chinese companies on the list, including Huawei, the Chinese telecoms equipment provider, and Semiconductor Manufacturing International Corporation, the chipmaker. Most recently, it placed DJI, the world’s biggest maker of commercial drones, on to the export blacklist.
The action on Thursday is the latest in a string of moves that the US administration has taken against China in the final days before Donald Trump leaves office on January 20 and Joe Biden is inaugurated.
The administration has also been expanding a list of Chinese companies with alleged ties to the country’s military, whose shares cannot be held by US investors under an executive order issued by Mr Trump in November. Two people familiar with the situation said the Pentagon was preparing to add nine Chinese companies to that list, in a move that could come as early as Thursday.
The defence and state departments had pushed to also include Alibaba, the Chinese ecommerce giant, and Tencent, the technology company that owns the WeChat messaging app, on the Pentagon list. But Steven Mnuchin, the Treasury secretary who believed it would harm US investors, successfully blocked the effort in an internal battle.
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