Japan and Russia have agreed to discuss ways to finance the construction of a pipeline and development of an oil field in eastern Siberia, Economy, Trade and Industry Minister Takeo Hiranuma said Friday.
Hiranuma said the two countries will host meetings involving experts to discuss how to finance the pipeline and conduct research on oil deposits.
The agreement came in a series of meetings held through Thursday between the Japanese government delegation, headed by Iwao Okamoto, director general of the Natural Resources and Energy Agency, and Russian Cabinet ministers.
The construction cost of the pipeline project is estimated at about $5 billion.
Okamoto arrived Tuesday in Moscow and held talks with Energy Minister Igor Yusufov, Economic Development and Trade Minister German Gref and Deputy Prime Minister Viktor Khristenko.
Japan and China have been lobbying for separate pipeline routes to get better access to Russian oil.
Tokyo has proposed linking eastern Siberia’s Angarsk with Nakhodka, a port city in Russia’s Far East. Beijing has called for a shorter route linking Angarsk and Daqing, a city in China’s Heilongjiang Province. So far, China appears to have the advantage over Tokyo.
When Okamoto visited Russia in April, Japan had offered to finance the entire pipeline construction and asked for a loan guarantee from Moscow in return.
But Russia rejected that proposal under the weight of massive external debts, stalling the bilateral talks.
Japan has since relented and decided to move forward with no promise of a Russian guarantee on financing.
Hiranuma meanwhile denied that Moscow has proposed that Tokyo and Russia jointly develop the Azadegan oil field in Iran.
Japan wants to develop the Iranian oil field and has been negotiating with Iran, but the prospect is now cloudy because the United States has warned Japan to withdraw from the project on grounds that the Middle East country is suspected of developing nuclear weapons.