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Japan, Russia need to enhance trust before gas pipeline plans

TOKYO (Reuters) — Japan and Russia need to work on building a more trusting relationship before any plans to build a natural gas pipeline between the two nations can be fulfilled, Japan's Minister for Economy, Trade and Industry Hiroshige Seko said on Monday.

Building a pipeline linking Russia and Japan is a long-standing idea, but a dispute over islands seized by Russia near the northern Japanese island of Hokkaido at the end of the World War Two has kept relations testy at times.

Japanese gas and electric utilities that have invested heavily in import terminals for LNG may also be reluctant to invest in a pipeline.

"Without a sense of further sense of trust such as a peace treaty, a pipeline would be no good," Seko said during a speech in Tokyo while answering a question about Japan's energy relationship with Russia.

Japan imports nearly all of its energy sources and is the world's biggest buyer of LNG, which is natural gas cooled until it becomes a liquid and then transported on ships.

Japan's Prime Minister Shinzo Abe said in April that Japan wants to resolve a territorial row that has over-shadowed ties with Russia since World War Two.

Russia and Japan did not sign a formal peace treaty at the end of the war because of a dispute over the northern islands, called the Northern Territories in Japan and the Southern Kuriles in Russia.

The islands were seized by Soviet forces at the end of the war and 17,000 Japanese residents were forced to flee.

Despite the lingering dispute, Seko said that Japan imports around 10% of its LNG from Russia and the country could increase its reliance on Russia's LNG a little bit more.

Reporting by Yoshifumi Takemoto; Writing by Osamu Tsukimori; Editing by Aaron Sheldrick and Christian Schmollinger


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