Nearly four years after Japan and Saudi Arabia agreed to form a pact to rev up Japanese private investment in the world's largest oil-exporting country, negotiations remain stalled and the treaty hangs in limbo.

In early November 1997, then Prime Minister Ryutaro Hashimoto made an unprecedented trip to Riyadh in a desperate bid to secure an extension of Arabian Oil Co.'s oil-drilling rights in the Saudi-controlled portion of the Khafji oil field -- situated between Saudi Arabia and Kuwait.

Hashimoto's visit was apparently prompted by implicit threats from Saudi Arabia that the Japanese firm would be denied an extension of the drilling rights unless Japanese companies increased investment in the country.