- Fed minutes highlight divisions over rate cut decision
- Steve McQueen debuts new WWII film at London festival
- Nobel winners hope protein work will spur 'incredible' breakthroughs
- What are proteins again? Nobel-winning chemistry explained
- AI steps into science limelight with Nobel wins
- Overshooting 1.5C risks 'irreversible' climate impact: study
- Demis Hassabis, from chess prodigy to Nobel-winning AI pioneer
- Global stocks diverge as Chinese shares tumble
- Time runs out in Florida to flee Hurricane Milton
- Chad issues warning ahead of more devastating floods
- Creator's death no bar to new 'Dragon Ball' products
- Chinese stocks tumble on lack of fresh stimulus
- Trio wins chemistry Nobel for protein design, prediction
- Braving war: Lebanon's 'badass' airline defies odds
- US weighs Google breakup in landmark trial
- Chinese stocks tumble on stimulus upset, Asia tracks Wall St higher
- 7-Eleven owner confirms new takeover offer from Couche-Tard
- A US climate scientist sees hurricane Helene's devastation firsthand
- Can carbon credits help close coal plants?
- Boeing suspends negotiations with striking workers
- 7-Eleven owner's shares spike on report of new buyout offer
- Your 'local everything': what 7-Eleven buyout battle means for Japan
- AI-aided research, new materials eyed for Nobel Chemistry Prize
- The US economy is solid: Why are voters gloomy?
- Scientists sound AI alarm after winning physics Nobel
- Nobel-winning physicist 'unnerved' by AI technology he helped create
- Trump secretly sent Covid tests to Putin: Bob Woodward book
- Neural networks, machine learning? Nobel-winning AI science explained
- Boeing delivers 27 MAX jets in September despite strike
- Stock markets diverge as Hong Kong sinks, oil prices fall
- US trade gap narrowest in five months as imports slip
- Stay and 'you are going to die': Florida braces for next hurricane
- Geoffrey Hinton, soft-spoken godfather of AI
- Duo wins Physics Nobel for 'foundational' AI breakthroughs
- German 'Maddie' suspect could be free in 2025 after cleared of separate sex crimes
- China slaps provisional tariffs on EU brandy imports
- Duo wins Physics Nobel for key breakthroughs in AI
- German 'Maddie' suspect could be free soon after cleared of separate sex crimes
- China says to take anti-dumping measures against EU brandy imports
- China stocks rally fizzles on stimulus worries amid Asia retreat
- China stocks rally peters out on stimulus worries amid Asia retreat
- Taiwan's Foxconn says building world's largest 'superchip' plant
- Nobel literature jury may go for non-Western writer
- From Bolivia to Indonesia, deforestation continues apace
- China holds off on fresh stimulus but 'confident' will hit growth target
- German suspect in 'Maddie' case faces verdict in sex crimes trial
- Top economic official 'confident' China will hit 2024 growth target
- COP29 fight looms over climate funds for developing world
- Shanghai stocks soar to extend stimulus rally amid Asia-wide drop
- Will Tesla's robotaxi reveal live up to hype?
RIO | -0.52% | 66.315 | $ | |
CMSC | 0.04% | 24.65 | $ | |
SCS | 1.74% | 13.006 | $ | |
BCC | 0.3% | 142.445 | $ | |
NGG | -0.38% | 65.65 | $ | |
RBGPF | -2.48% | 59.33 | $ | |
BTI | 0.72% | 35.475 | $ | |
CMSD | -0.15% | 24.815 | $ | |
BCE | -0.62% | 33.305 | $ | |
JRI | 0.35% | 13.206 | $ | |
RYCEF | -1.01% | 6.9 | $ | |
VOD | 0.77% | 9.735 | $ | |
RELX | 0.27% | 46.765 | $ | |
GSK | 6.01% | 40.45 | $ | |
AZN | 0.81% | 77.5 | $ | |
BP | 0.01% | 32.034 | $ |
Sakhalin exception: the Russian energy Japan can't quit
This year's Group of Seven president Japan has joined the bloc's condemnation of Russia's Ukraine invasion, imposing sanctions and agreeing on an oil price cap, with one exception: Moscow's Sakhalin energy projects.
Sakhalin-1 and 2 in Russia's far east are an anomaly in Tokyo's otherwise lockstep efforts with allies to reduce reliance on Moscow's hydrocarbons.
It's a contradiction that Japanese officials, and some experts, feel is unavoidable for a country that is by far the least energy self-sufficient in the G7.
But others warn the decision is a "vulnerability" for Tokyo, that "undermines" its diplomacy.
Last year, Japan pledged to phase out Russian coal imports and gradually decrease its energy dependence on Moscow.
Government data released on Thursday showed that oil imports from Russia fell around 56 percent last year, while coal imports were reduced by 41 percent.
But imports of Russian liquefied natural gas (LNG) were up more than four percent in 2022.
Sakhalin-1 produces oil, while Sakhalin-2 produces both crude and LNG, and experts say access to Russian gas is what Japan is most concerned about protecting.
Last year, 9.5 percent of Japan's total LNG imports came from Russia, up from 8.8 percent in 2021 -- most of it from Sakhalin-2.
So when Japan joined a price cap on Russian oil last year with its G7 allies, the European Union and Australia, it obtained an exemption for Sakhalin-2.
And while US and British firms ExxonMobil and Shell have relinquished their stakes in Sakhalin-1 and 2 respectively, Tokyo has stayed put, even complying with new Russian rules.
It's a purely pragmatic position, said Hiroshi Hashimoto, head of the gas group at the Institute of Energy Economics.
"They are geographically so close to the country and have significant energy resources," he told AFP. "The projects were developed to diversify energy sources."
- 'Notably contradictory' -
Japan has never forgotten the oil shock of the 1970s, and energy security threats "are ingrained in the mindset of the Japanese government", said James Brown, a political science professor at Temple University's Japan campus.
The country's energy supplies would be particularly at risk "in the case of a crisis in the Middle East or in the South China Sea, through which much of Japan's energy is shipped", he added.
Still, Japan got only 1.46 percent of its oil imports from Russia in 2022, and not all came from Sakhalin.
Its main interest is protecting access to Sakhalin-2's LNG, said Yuriy Humber, founder of Japan NRG, a platform analysing energy and electricity markets in Japan.
"If you put an embargo on the oil, but the project is still producing both oil and gas... you make it very difficult on an engineering and economic basis to keep the project going," he told AFP.
The war means competition for alternatives to Russian LNG has increased, along with prices, and Japan has little storage capacity, making Sakhalin's proximity key.
"The alternatives aren't really very easy and they are very expensive," he noted, with long-term contracts recently agreed with the United States and Oman unlikely to be delivered for years.
Japanese officials frame the continued use of Sakhalin as an energy security imperative, and warn that withdrawing could see China enter the projects.
But Brown believes the projects are a "vulnerability" that leave Japan at risk of retaliation from Moscow.
"The Russian government has been very clear that they view Japan as an 'unfriendly state'," he said.
"There is every reason to think that they could also manipulate exports from the Sakhalin projects to retaliate against Japan."
Several eastern European countries have secured exemptions to the bloc's oil ban and price cap, but as this year's G7 president, Japan's Sakhalin exception stands out.
"The decision to keep stakes in Sakhalin-1 and 2, and exempt its actions from the G7 oil price cap, is notably contradictory," Wrenn Yennie Lindgren, a researcher for the Norwegian and Swedish Institutes of International Affairs, told AFP.
It "undermines the moral and values-based diplomacy that it is pledging to strengthen during its (G7) presidency", she added.
But Japan NRG's Humber believes Japan has little alternative.
"You can only afford to be moral when you have a pragmatic solution."
X.Wong--CPN