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. Last Updated: 07/27/2016

Pipeline Plan Pushed in Tokyo

ReutersTaro Aso and Viktor Khristenko laughing before a meeting Monday in Tokyo.
Russia has completed the first stretch of a proposed trans-Siberian oil pipeline that will feed energy-hungry Asian markets, and will push ahead with construction plans, despite the concerns of environmentalists, Industry and Energy Minister Viktor Khristenko said Monday.

Khristenko told Japanese Foreign Minister Taro Aso that Russia has completed a 700-kilometer section of the planned 4,300-kilometer pipeline from east Siberia to Russia's Pacific coast, said a Foreign Ministry official who spoke on condition of anonymity.

Khristenko also confirmed that the pipeline, being built by pipeline firm Transneft, would run to the coastal village of Kozmino in the Primorye region, the official said. Ecologists warn the route would endanger popular beaches, fishing grounds and rich marine life.

Environmental concerns have already forced changes in the pipeline project, which would move 1.6 million barrels per day and greatly boost Moscow's oil exports to markets in Japan, China and South Korea.

Last year, Transneft said it would reroute the pipeline away from Lake Baikal, the world's largest freshwater lake, after intense lobbying by ecologists.

The pipeline has also become a bone of contention between Japan and China as they jostle for priority over access to Russia's vast oil reserves.

Russia is planning a branch line that would carry crude directly to the northeastern Chinese city of Daqing, the center of its oil industry, stoking Japanese concerns that the Russians will not extend the pipeline to the Pacific coast as quickly as planned.

Japan will be keen to acquire liquefied natural gas from the Sakhalin-1 project if it changes its plan to ship natural gas by pipeline, the Japanese government said Monday.

Aso told Khristenko that Japan would be interested in LNG from the Sakhalin-1 project, led by U.S. major ExxonMobil, a ministry official said.

Aso "said that apart from crude oil, Japan is also interested in LNG, and Minister Khristenko said he understood that well," said the Foreign Ministry official, who attended the meeting.

The Japanese government will provide guarantees of up to $170 million on syndicated loans to build a new terminal at Sheremetyevo Airport, sources close to the matter said Monday.

Japan and Russia are slated to sign an agreement Wednesday during a visit by Prime Minister Mikhail Fradkov in which the state-backed Japan Bank for International Cooperation would guarantee loans to fund the construction of Terminal 3 at the airport, the sources said.

(AP, Reuters)