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3RD LD: Japan rejects China's new offer on joint gas development+
[March 08, 2006]

3RD LD: Japan rejects China's new offer on joint gas development+


(Japan Economic Newswire Via Thomson Dialog NewsEdge)TOKYO, March 8_(Kyodo) _ (EDS: ADDING MORE COMMENTS FROM ABE, CLARIFYING 6TH GRAF)

Japan's top government spokesman on Wednesday rejected China's new proposal that the two countries jointly explore gas and oil in two areas in the East China Sea.

"This proposal is something that we cannot accept," Chief Cabinet Secretary Shinzo Abe said at a press conference. "The offer contradicts the position we have taken so far." He also said in the afternoon news conference that Japan wants China to make "a realistic suggestion."



During the latest bilateral talks in Beijing on Monday and Tuesday, China proposed to Japan that they jointly tap natural resources in two areas in the East China Sea, including one around the Japan-controlled Senkaku Islands, Japanese government sources said Wednesday.

Abe, however, declined to confirm whether the proposal included the area around the Senkaku Islands, claimed separately by Japan, China and Taiwan.


He said the two sides had failed to narrow their gaps over the demarcation in the East China Sea where the two countries' 200-nautical-mile exclusive economic zones overlap, which is the root of the gas row.

In addition to waters around the uninhabited Senkaku Islands, China also proposed that the two countries could together develop marine resources in the northern sea area along the Japan-proposed "median line" to separate their economic waters, the sources said.

The islands are called Diaoyu in China and Tiaoyutai in Taiwan.

The two sea areas are potentially rich in gas and oil, according to industrial sources.

Japan had earlier presented an offer to conduct joint development of four gas fields near the median line, but China's latest offer covers the northern and southern areas of those fields.

"Even though China said our proposal is 'problematic,' we would like Beijing to closely study our offer once again. I believe it's beneficial to both countries," Abe said.

He said the two countries will present their views on each other's proposal during the next round of gas talks. Japan and China have agreed to hold the next meeting, the fifth of its kind, in Tokyo as soon as possible.

The next session could take place in April at the earliest, the sources said.

The areas for joint exploration included in China's new offer are waters on the Japanese side, or east of the median line, near the Senkaku Islands and slightly into the Chinese side, or west of the line, in the northern East China Sea, according to the sources.

Beijing does not recognize the Japan-claimed median line, as it insists it has rights to marine resources east of the line to the edge of the continental shelf near Japan's southernmost prefecture of Okinawa.

Both the continental shelf and median line demarcation principles are accepted under international law.

Tokyo is concerned about several ongoing Chinese gas projects on the Chinese side of the median line, which it believes could siphon off resources that could be buried under Japan-claimed waters because of their proximity to the line.

The Japanese government granted Teikoku Oil Co. permission last July to conduct experimental drilling in areas just east of the median line, in an apparent bid to counter China's gas development. But the oil developer has yet to start tests.

Abe said Japan maintains its right to conduct the test drilling, but suggested that Tokyo will focus on gas talks for the time being to resolve the row.

However, he underlined that there has been growing pressure in Japan for the government to seek a tougher negotiation approach by using the test-drilling option as leverage, and expressed hope Beijing will take note of it.

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