By Eric Watkins
Middle East Correspondent
NICOSIA, Aug. 26 -- Japan has announced progress in talks with Iran for the development of giant Azadegan oil field, apparently brushing aside US concerns about nuclear proliferation issues in the Middle Eastern country.
Japanese Minister of Trade and Industry Takeo Hiranuma told a news conference in Tokyo Monday that, "We have reached substantial compromises on some points," adding that, "We still need to tie up loose ends."
A Japanese consortium consisting of Tomen Corp., Inpex Corp., and Japan Petroleum Exploration Co. also reportedly has moved closer to an agreement with Iran for joint development of the field.
Hirnuma's statement followed more strident remarks Sunday by Japanese Agency Director-Gen. Shigeru Ishiba insisting that Tokyo should ignore US opposition and reach an agreement with Tehran.
"I do not think we should give it up because America says so," Ishiba said during a talk show on the private Asahi network.
"Although I am not the supervising minister (for energy issues) . . . I do not think abandoning (negotiations with Iran) because of America's opposition would promote Japan's national interest," he said.
Japan missed a June deadline for coming to an agreement over development of Azadegan. Ishiba insisted that Japan should "hold out" against US objections.
June crude oil imports into Japan rose 23.9% from the same time a year earlier. Its reliance on Middle Eastern crude oil, estimated at 85.1% in June, was up 0.5% from the same time last year, said Ministry of Economy, Trade, and Industry figures.
Diversifying Japan's energy sources
Japan's earlier hesitation over the development of Azadegan field enabled other countries—including China, Russia and India—to open talks with Iran, much to the chagrin of Japanese government and business leaders intent on diversifying the country's sources of energy imports.
Many Japanese also see Azadegan field, reputed to have 26 billion bbl of oil reserves, as a way of making up for the loss of Japan's concession rights in Khafji oil field in the Kuwait-Saudi Arabia neutral zone.
But US President George W. Bush's administration has introduced an obstacle to Tokyo's plans by accusing Tehran of using its atomic energy program as a cover for the development of an illicit nuclear weapons program, a charge the Iranians deny.
Iranian Foreign Minister Kamal Kharazi repeated the denials Monday, telling China that Iran has no plans to develop nuclear weapons, and that its program of peacefully utilizing nuclear energy is completely transparent.
During a state visit to China, Kharazi added that Iran is prepared to cooperate with the International Atomic Energy Agency (IAEA), particularly the signing of an additional protocol to the nuclear Non-Proliferation Treaty.
Last month, the head of Iran's atomic energy agency said his country and the IAEA could reach "positive" results by September regarding the protocol.
"We have had good negotiations with (IAEA chief) Mohamed ElBaradei, and I believe it is possible that, before September, we will have positive results on this matter," said Gholamreza Aghazadeh.
Iran has come under strong international pressure to prove that it is not secretly developing atomic weapons by signing the additional protocol, which would allow UN inspectors to investigate suspect sites without warning.
The IAEA's board of governors will review Iran's position on Sept. 8, with the possibility that the case might be forwarded to the UN Security Council. This month, IAEA inspectors arrived in Iran to carry out final checks before the review.
