MOSCOW (Kyodo) The Japanese government on Monday began considering offering a larger subsidy than initially planned to encourage Japanese companies to join a Siberian oil field exploration project planned by Russia, according to well-placed sources.

The subsidy plan is designed to enable Japan to secure concessions linked to an east Siberian oil field near Lake Baikal and counteract Chinese attempts to persuade Russia to send Siberian oil to China, the sources said.

Although major Japanese oil explorer Inpex Corp. and trading houses have considered joining the Siberian project, they are waffling in view of the lack of a Russian government guarantee that Moscow will build a pipeline that could deliver oil up to the Russian Pacific coast.

The firms are now in talks with the Ministry of Economy, Trade and Industry over a proposal to get the government-backed oil explorer, Japan Oil, Gas and Metals National Corp. (JOGMEC), to hike the percentage of the JOGMEC investment in combined Japanese investments by the private and official sectors to 70 percent from the initially planned 50 percent, they said.

Tokyo has been asking the Russian government to pledge that it will build the entire route of the projected 4,188-km pipeline from Taishet near Baikal to a location near Nakhodka, a port city on the Pacific.

But Russia has indicated it puts priority only on development of the Siberian oil field without providing any guarantee of building the pipeline’s eastern half. This has made potential Japanese participants uneasy.

Although JOGMEC investments are usually limited to projects at locations where developments are extremely difficult, such as those in polar regions and offshore oil fields, Japan began to consider having the state-backed entity put up more money for the Siberian project, they said.

Russian Industry and Energy Minister Viktor Khristenko has said Moscow is planning to hold some 50 tenders related to east Siberian oil field developments.

Russia has not decided when to start construction of the eastern half, although it started building the western half April 28 under a plan to complete that portion in 2008.

The plan calls for linking the envisioned Siberian development site with Skovorodino, the midpoint of the entire pipeline route near the Russian-Chinese border.

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