VLADIVOSTOK, RUSSIA – The Russian subsidiary of a U.S. firm has begun work on building a geothermal power station on Kunashiri Island, which is part of a long-standing territorial row between Tokyo and Moscow, an official of the company said.
The generation capacity of the new facility — to be constructed by a Russian unit of the Alabama-based Tiger Machinery LLC — will exceed that of Kunashiri’s existing geothermal plant by more than four times, enough electricity to power all of the island, the official said Thursday.
Equipment will begin to be transported to Kunashiri, off northern Hokkaido, from the United States in July under the 890 million ruble (¥2.8 billion) project and the plant is scheduled to begin operations in 2015, according to the official and sources.
It is apparently the first time a U.S. company has joined a project on the disputed islands of Kunashiri, Etorofu and Shikotan or the Habomai islet group — known in Russia as the Southern Kurils — which were seized by Soviet forces at end of World War II. Japan has demanded their return for decades, and the dispute has prevented the two countries from signing a formal postwar peace treaty.
A string of foreign corporations have become involved in infrastructure projects on the four Russian-held islands, and the participation of an American firm will only heighten concerns in Tokyo that these projects are further cementing Moscow’s jurisdiction.
Sakhalin Machinery LLC — whose parent company is Tiger Machinery LLC — has already received the order to build the plant and commenced preparatory work, according to the sources and company official. Sakhalin Machinery operates in the Russian Far East and markets heavy machinery and power generation facilities.
An aging geothermal power station on the outskirts of Kunashiri’s port of Furukamappu currently supplies up to 40 percent of the island’s electricity needs. Seeking to construct a new geothermal plant in the same area, the Russian government contracted Sakhalin Machinery in late 2011 to carry out the project, they said.
One of the sources said there was debate within Sakhalin Machinery before the bidding process about doing business on the disputed island, but the firm decided to take part after recognizing the economic benefits.
Although Tokyo does not approve of any economic activity or investment by foreign businesses on any of the four Russian-held islands, several projects by foreign firms, including a South Korean company, are currently being pursued.
Mori to visit Putin
Former Prime Minister Yoshiro Mori said he will visit Russia as Prime Minister Shinzo Abe’s special envoy for a meeting with Russian President Vladimir Putin later this month.
“As a Japan-Russia summit is likely to come within this year, I will listen to what (Russia’s) president has to say,” Mori, 75, told reporters Thursday, following a meeting with Abe at which he was asked to deliver a personal message from the prime minister to Putin.
A long-running territorial dispute to which both Tokyo and Moscow are seeking to find a “mutually acceptable” solution will top the agenda at Mori’s meeting with Putin. The sovereignty of four Russian-held islands off Hokkaido that are claimed by Japan has blocked Japan and Russia from concluding a peace accord to formally end World War II.
Mori is also expected to exchange views with Putin and Russian officials on how to respond to North Korea’s third nuclear test earlier this week. Mori served as prime minister between 2000 and 2001 and enjoys a personal friendship with Putin.