Defying US, Japan signs $2 billion oil deal with Iran
Japan has signed an estimated two billion dollar deal to exploit Iran's Azadegan oil field, despite opposition from the United States over Tehran's nuclear program.
A Japanese consortium backed by the government negotiated the deal with Iran as the resource-poor nation depends on imports to supply over 80 percent of its energy needs.
Tokyo will finance 75 percent of the project, which is estimated to have 26 billion barrels of crude oil reserves.
Under the deal, Inpex Corporation, Japan Petroleum Exploration Company and Tomen Corporation are to develop the southern half of Azadegan, producing some 50,000 barrels of crude oil per day by the summer of 2007 and then increase the amount.
Tokyo obtained priority-bidding rights to develop the Azadegan field in late 2000. Negotiations over Japan’s involvement in its exploration were carried out over the past two years. However, American pressure reportedly compelled Japan to suspend the two billion dollar investment.
The US State Department has repeatedly voiced concerns over Iran's nuclear program and its alleged role in sponsoring terrorism. These concerns have translated into opposition to the long-negotiated deal, which was supposed to be signed July 1, between Tehran and the Japanese consortium.
Japan and Iran stepped up talks as Washington's pressure eased after Tehran accepted inspections late last year by the International Atomic Energy Agency (IAEA). Kyodo News quoted US State Department spokesman Richard Boucher as saying; “Our policy has been, with respect to Iran, to oppose petroleum investment there…We remain deeply concerned about deals such as this."
Japan relies on the Middle East for over 85 percent of its $50 billion annual oil imports. Iran is already Japan's third-largest supplier of crude. As a key US ally, Japan backed the Bush Administration’s war on Iraq. — (menareport.com)
© 2004 Mena Report (www.menareport.com)
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