"We are endeavouring to undertake a new diplomatic initiative which we hope will help the situation," foreign department spokesman Raul Hernandez said via text message when asked for a response to the Chinese statement.

Hernandez said he would not provide further details of the Philippine efforts.

China's foreign ministry released a statement earlier Tuesday in which vice foreign minister Fu Ying accused the Philippines of being responsible for escalating tensions over the disputed area in the South China Sea.

"The Chinese side has... made all preparations to respond to any escalation of the situation by the Philippine side," Fu told a Philippine diplomat on Monday, according to the statement.

The row began a month ago when Chinese vessels blocked a Philippine warship from arresting crews of Chinese fishing boats near the Scarborough Shoal in the South China Sea.

The two countries have since maintained ships in the shoal in an effort to assert their country's sovereignty.

The Philippines says the shoal is well within the country's 200-nautical-mile exclusive economic zone, as recognised by international law.

But China claims almost the whole of the South China Sea as its historical territory, even waters close to other countries' coasts and hundreds of kilometres from its own landmass.

The reported negotiations between Philex Petroleum and China National Offshore Oil Corporation come as the two nations are locked in an increasingly tense territorial dispute over the area.

Philex Petroleum chairman Manuel Pangilinan said he met officials from state-owned CNOOC, China's biggest oil and gas producer, last week to discuss development of Reed Bank in the South China Sea.

"I met with CNOOC in Beijing. We discussed SC 72," he told reporters, referring to the Philippine exploration block covering part of Reed Bank that was awarded to Philex.

Pangilinan said CNOOC had invited him to Beijing but refused to give further details about the substance or outcome of the discussions.

Philex Petroleum said last month the field at Reed Bank could hold 4.66 trillion cubic feet (TCF) of gas, nearly twice as big as the Philippines' largest known deposits.

Reed Bank is about 148 kilometres (92 miles) off the Philippine island of Palawan. But China claims nearly all of the South China Sea, even waters close to the coasts of Southeast Asian nations.

The Philippines last year accused Chinese vessels of harassing a Philex-contracted exploration vessel at Reed Bank, one of the first incidents in a series that has dramatically escalated tensions between the two countries.

In a speech before Congress last year, Philippine President Benigno Aquino vowed to defend the country's claim to Reed Bank.

However Aquino has also since expressed a willingness to jointly develop the area, as long as it is done under Philippine law.

The Philippines and China have for the past month stationed ships at Scarborough Shoal, more than 400 kilometres to the north of Reed Bank, in an effort to assert their sovereignty over that part of the South China Sea.