Japan is in final negotiations with Beijing to pay around 300 million yen for the victims of an August poison gas leak from Japanese wartime chemical weapons left behind in China, government sources said Friday.

“We have been negotiating the issue in Beijing, and we will deal with it positively and hope to reach an agreement as soon as possible,” Deputy Chief Cabinet Secretary Masaaki Yamazaki said at a news conference Friday afternoon.

In August, a mustard gas leak at a construction site in Qiqihar, Heilongjian Province, killed a man and injured 40 others.

The Chinese government was initially demanding that Japan pay compensation. Tokyo instead offered “cooperation money” to help the victims, given that China renounced its right to claim such compensation under 1972 Japan-China joint declaration.

Japan was considering offering 100 million yen as a token of “sympathy,” but China rejected the idea, and both sides were close to agreement on 300 million yen, sources said.

Prime Minister Junichiro Koizumi will probably convey the decision when he meets with Chinese President Hu Jintao on Monday on the sideline of the Asia-Pacific Economic Cooperation summit.

When Koizumi met with Chinese Premier Wen Jiabao earlier this month, he promised that Japan would “respond sincerely” to China’s request.

“As the prime minister said, Japan will deal with the issue in a sincere manner,” Yamazaki said.

The August incident, which angered the Chinese public, is the latest in a series of troubles caused by Japan’s abandoned weapons.

Chinese plaintiffs in another poison gas case recently won a Tokyo District Court ruling, which ordered the Japanese government to pay 190 million yen in compensation, but the government appealed the ruling with the Tokyo High Court.

The Japanese military is believed to have left some 700,000 artillery shells, bombs and other weapons loaded with chemical agents in China after its defeat.

China says the abandoned weapons have killed at least 2,000 Chinese since 1945. Experts from both countries have worked together in recent months to dispose of the weapons.

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