Xi was met by top officials as a military brass band played in Manila, the last stop in a three-nation swing through Asia in which he's offering infrastructure loans and aid and championing free trade in a rivalry for influence with the United States.
Before Xi arrived for the visit, Philippine lawmakers demanded that Duterte release details of the energy deal.
However, after Duterte took office, he quickly put aside the Hague court ruling and extended the olive branch to Beijing.
The two-day state visit to the Philippines has been the first one by a Chinese head of state in 13 years. Just $5 a month. While the United States routinely flies bombers in the vicinity of the South China Sea as part of its long standing "Continuous Bomber Presence" missions, Beijing is particularly sensitive about the presence of USA military forces near areas where the Chinese government has built islands and established military facilities on disputed maritime features. Senate Minority Leader Franklin Drilon said the Philippine leader had adopted "a policy of appeasement" toward China and he hoped the loan deals wouldn't be a case of "broken promises". The exact location remains undisclosed, but Philippines Energy Secretary Alfonso Cusi disclosed to reporters after the meeting that the deal covers the "West Philippine Sea/South China Sea".
The Philippines, not China, should draft an oil and gas exploration agreement, Foreign Secretary Teodoro Locsin Jr. said on Wednesday.
Philippine outlet Rappler reported on Tuesday that its sources confirmed the countries will create an agency to explore how joint exploration might proceed, but that this will not necessarily lead to joint marine exploration. "But it does pave the way for the crafting of a program on how such joint ventures can happen in the future".
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Xi said he and Duterte would elevate their relationship to one of "comprehensive strategic cooperation", adding that they had many common interests in the South China Sea, and would continue to "manage contentious issues".
The senators' rebuke came as USA think tank Center for Strategic and International Studies released new satellite images on November 20 that revealed China had installed a new platform on the Bombay Reef, an atoll in the disputed Paracel Islands chain of the South China Sea.
China-funded infrastructure projects in countries such as Sri Lanka and Djibouti have drawn criticism for burdening poor nations with massive debt. For example, a year ago China reportedly threatened to attack Vietnamese bases in the South China Sea unless Hanoi halted Spanish firm Repsol's drilling in the South China Sea.
Filipino nationalists have warned that any agreement that can undermine the Philippines' internationally recognized exclusive rights to fish and exploit resources within 200 nautical miles of the country's coast would violate the Philippine Constitution. Some experts see joint development as a solution, while others worry that agreeing to it would legitimize the Chinese claim. He disclosed that he might ask her to communicate with or sing a song for Xi in Chinese when the latter visits the Philippines.
The two leaders likewise discussed cooperation on the reconstruction and rehabilitation of Marawi, which was the site of a bloody siege by the Daesh-inspired Maute Group, and the Philippines' participation in China's Belt and Road Initiative.
The two leaders held a bilateral meeting, charting the course for the future of Philippines-China bilateral relations, had an in-depth exchange of views on regional and global issues of common interest, and reached an important consensus.