Japan National Oil Corp. said Thursday it has decided it will participate in a project to develop Iran's largest oil field, the Azadegan field, situated near the Iraqi border.
The state-run company investing in oil and gas projects said it will carry out the assessment of oil deposits in the field as a joint project with Japan Petroleum Exploration Co. and Tokyo-based oil development firm Indonesia Petroleum Co.
Japan National Oil will also consider providing financial assistance for surveys toward drilling rights talks with Iran.
Last month, Prime Minister Yoshiro Mori and visiting Iranian President Mohammad Khatami agreed to grant Japanese oil developers the first opportunity to negotiate for drilling rights in the Azadegan oil field.
Japan National Oil Corp. on Thursday also adopted a new five-year business plan until 2005, under which it will effectively withdraw from loaning money and instead focus on capital participation in promising oil and gas development projects.
Money lending in the past has left the state-run investment company for oil and gas development projects saddled with massive debts.
Projects in which private concerns have shares will be eligible for support, but it will not support national project-type developments in which a number of shareholders participate, the corporation said.
The corporation also said crude oil produced by projects involving Japan National Oil will no longer have to be exported to Japan during peacetime.
Japan National Oil's ballooning debts, stemming from failed investments in oil and gas development companies, prompted the Ministry of International Trade and Industry in 1998 to request the corporation suspend unprofitable operations and restructure itself.
Japan National Oil incurred 351.8 billion yen in deficits as of the end of fiscal 1999, or March 31, 2000.