Chart 4-9: The South Stream and Nabucco Gas Pipelines
4.3.5 Competition for Central Asian energy: Japan’s Strategies
gaining attention from companies operating in Iraq, thus Iraq is considered a potential gas exporter to Europe. 248
European Energy Commissioner Günther Oettinger wrote in a newspaper column on July 5th, 2013 that the route planned for the Nabucco West pipeline project is not dead, and that there could still be an alternative gas route to Austria, which is still under discussion. 249
4.3.5 Competition for Central Asian energy: Japan’s Strategies
In 1997, based on its energy and geopolitical considerations, Japan’s Prime Minister, Hashimoto Ryutaro, introduced “Silk Road Diplomacy,” Japan’s policy placing Central Asia in an important position. Thereafter, the Japanese government continued to implement economic aid policies, strategies to increase diplomatic efforts in Central Asian countries, copying the Shanghai Cooperation Organization to establish a “Central Asia plus Japan”
forum. In August 2004, on the basis of existing bilateral cooperation, during the visit of Yoriko Kawaguchi to Central Asia, the first meeting of the “Central Asia plus Japan” forum was held among the foreign ministers of Japan, Uzbekistan, Tajikistan, and Kyrgyzstan with incentives to expand the Japan’s partnership with nations in the region. In 1995 the Japanese company Mitsubishi, Exxon, China’s CNPC and other companies conducted a research project named "Turkmenistan-China-Japan Gas Pipeline Project.” According to the project, a natural gas pipeline is planned to travel from the origin of the (natural gas) resources, Turkmenistan, through Uzbekistan, Kazakhstan, China’s east coast, and finally to come across the Yellow Sea and make delivery to Japan. In recent years, the Senkaku Islands dispute has soured relations between Japan and China. How the two countries, through diplomatic channels, resolve the impasse is a major issue.
248 “Trans-Caspian gas pipeline vital to Nabucco,” Petroleum Economist, Oct 17, 2011, available at:
http://www.petroleum-economist.com/Article/2918721/Trans-Caspian-gas-pipeline-vital-to-Nabucco.html, (accessed: 20140316).
249 “EU's Oettinger says Nabucco route not dead –newspaper,” Reuters News Agency, Jul 5, 2013, available at:
http://www.reuters.com/article/2013/07/05/gas-pipeline-eu-idUSL5N0FB0EY20130705, (accessed: 20140320).
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In 1968, Japan became the world's second largest economy. Japan's industry sector is highly developed but resources are extremely scarce. There are currently only a small number of oil fields off its coast in the Sea of Japan, which only account for 0.2% of the amount of the national supply, and the rest is imported. So Japan is a net importer of oil and its energy strategy is one of the priorities for the country's foreign policy. In 1997, based on energy and geopolitical considerations, Japan’s Prime Minister, Hashimoto Ryutaro, introduced the concept of Eurasian Diplomacy, by promoting his policy of “Silk Road Diplomacy,” outlining Japan’s foreign policy, placing Central Asia in an important position.250
4.3.5.2 Establishment of the “Central Asia plus Japan” forum and Aid to Central Asia
In August 2004, on the basis of existing bilateral cooperation, during the visit of Yoriko Kawaguchi to Central Asia, the first meeting of the “Central Asia plus Japan” forum was held among the foreign ministers of Japan, Uzbekistan, Tajikistan, and Kyrgyzstan, which was a new form of collective cooperation designed as an effective mechanism with incentives to expand the Japan’s partnership with nations in the region. On June 5, 2006 a subsequent meeting was held in Tokyo. The ministers produced a new "Action Plan" based on five
"pillars" for cooperation: political dialogue, intra-regional cooperation, business promotion, intellectual dialogue, and cultural exchanges. On energy issues, with special emphasis on the promotion of mutual cooperation and support for the countries in the region, Japan decided to assist the Central Asian countries to build an energy transport corridor. In August 2006, the first visit of Japan’s Prime Minister Junichiro Koizumi to Kazakhstan and Uzbekistan drew attention to possible cooperation between Japan and those two Central Asian countries when Koizumi declared that Japan's new foreign policy will be more actively involved with Central Asia. 251
250 Rakhimov, Mirzokhid. “Central Asia and Japan: Bilateral and multilateral relations,” ScienceDirect.com, Jan, 2014, available at: http://www.sciencedirect.com/science/article/pii/S1879366513000328, (accessed: 20140508).
251 Yuasa, Takeshi. “Japan’s Multilateral Approach toward Central Asia,” Slavic-Eurasian Research Center, available at: http://src-h.slav.hokudai.ac.jp/coe21/publish/no16_1_ses/04_yuasa.pdf, (accessed: 20140520).
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From 1993, Japan provided assistance to Central Asia through the mechanism called
“Official Development Assistance” (ODA). The total bilateral ODA to the five Central Asian countries reached $2 billion in 2010 which mainly focus on infrastructure development in Central Asia. 252 The Japanese government continues to implement economic aid policies, strategies to increase diplomatic efforts in Central Asian countries, copying the Shanghai Cooperation Organization to establish a “Central Asia plus Japan” forum, Japan has gradually swayed the Central Asian countries to take the platform support in the international arena, and expanded its political influence in the region, making the political influence of China and Russia in Central Asia somewhat weakened.253
4.3.5.3 The Turkmenistan-China-Japan Gas Pipeline Project
In 1995 the Japanese company Mitsubishi, Exxon, China’s CNPC and other companies conducted a research project named "Turkmenistan-China-Japan Gas Pipeline Project" on whether transport of Central Asian gas through pipelines to China and onward to Northeast Asia is feasible. According to the project, a natural gas pipeline is planned to travel from the origin of the (natural gas) resources, Turkmenistan, through Uzbekistan, Kazakhstan, China’s east coast, and finally to come across the Yellow Sea and make delivery to Japan. 254
In 2009 after the launch of the China-Central Asia gas pipeline, Xinjiang’s and China’s West-East pipelines are well connected. The western section of the complicated West-East Gas Pipeline Project links Xinjiang to Shaanxi, and the eastern section connects Shaanxi and Shanghai. When it arrives at the Shanghai terminal, natural gas can be delivered to
252 Rakhimov, Mirzokhid. “Central Asia and Japan: Bilateral and multilateral relations,” ScienceDirect.com, Jan, 2014, available at: http://www.sciencedirect.com/science/article/pii/S1879366513000328, (accessed: 20140508).
253 Dadabaev, Timur. “Models of Cooperation in Central Asia and Japan's Central Asian Engagements: Factors, Determinants and Trends,” ISN, available at:
http://www.isn.ethz.ch/Digital-Library/Publications/Detail/?ots591=0c54e3b3-1e9c-be1e-2c24-a6a8c7060233&l ng=en&id=110796, (accessed: 20140512).
254 Crandall, Maureen S. Energy, Economics, and Politics in the Caspian Region: Dreams and Realities
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Lianyungang via the construction of smaller branches or rail routes to the north. After Turkmenistan’s natural gas is transported to China’s east coast port, Lianyungang, it can be shipped via the following two ways to Japan: 255 By shipping the liquid natural gas (LNG) to Japan’s sea ports via marine shipping. However, the cost for such shipping could be quite high and the volume that each tanker could carry is also inadequate. By constructing a gas pipeline from Lianyungang to Nagasaki in Japan (a total length of 900 km) (Please see Chart 4-12).
Currently, it’s possible to transfer natural gas via the network of Central Asian gas
pipelines and the West-East Gas Pipeline in China to Lianyungang, and the specific conditions for the pipelines to further extend to Japan have been initially equipped. However, because of the Senkaku Islands dispute between Japan and China, there has been a rapid deterioration in the relationship between the two countries.256 Therefore, how the two countries, through diplomatic channels, resolve the impasse is a major issue. Allowing Japan to receive natural gas from Central Asia, and also considering that China needs to meet its domestic demand for natural gas; can it export excess gas to Japan? China as a transit country could earn transit fees. In order to achieve a win-win situation, this issue deserves further research and consideration.
(Westport, Connecticut: Praeger Security International, 2006), p. 145.
255 Waelde, Thomas W. The Energy Charter Treaty: An East-West Gateway for Investment and Trade (London:
Kluwer Law International, 1996), p. 92.
256 Posner, Eric. “Why Are China and Japan Inching Toward War Over Five Tiny Islands?,” Slate Magazine, Feb 25, 2014, available at:
http://www.slate.com/articles/news_and_politics/view_from_chicago/2014/02/the_senkaku_or_diaoyu_islands_
where_world_war_iii_could_start_because_of.html, (accessed: 20140520).
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Chart 4-10: The Turkmenistan-China-Japan Gas Pipeline Project
Source: Compiled by author