An advisory panel on administrative reform called for merging several oil developers affiliated with the state-run Japan National Oil Corp. into one entity after JNOC is scrapped.
In a report presented Wednesday to Nobuteru Ishihara, state minister for administrative reform, the panel also recommended that Japan Highway Public Corp. and three other state-run road management firms be realigned and privatized.
These recommendations will serve as a basis for the government’s administrative reform plan, which will be finalized by the end of the year.
Under the panel proposals, Japan Oil Development Co., Japan Petroleum Exploration Co., Indonesia Petroleum Ltd. and other key JNOC-affiliated oil developers would be integrated under a holding company set up by the state.
The total asset value of the integrated entity would stand at around 1 trillion yen and it would essentially serve as a single body overseeing Japan’s oil development projects. JNOC’s investments in and loans to oil exploration companies would be taken over by the Japan Bank for International Cooperation.
Regarding the four road management firms, the panel said that a new independent administrative agency should be formed to take over their assets and debts, while six private firms should be set up to run the nation’s highways.
The four firms in question are JHPC, Metropolitan Expressway Public Corp., Hanshin Expressway Public Corp. and Honshu-Shikoku Bridge Authority.
The six companies would collect tolls and pay rental fees on the roads to the administrative agency, which would then use this income to pay off debts.
The panel estimates that, under this scheme, the four special public corporations’ debts, which total around 38 trillion yen, could be repaid within 30 years.
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