Japan's Cabinet today approved a revised energy policy that highlights stronger ties with nations producing oil, natural gas and uranium, and the development of next-generation nuclear technology, the government said.
"Moving ahead with nuclear power development, concerted efforts to secure stable supply of oil and energy-saving are the pillars of the revised policy,'' Trade Minister Akira Amari told reporters after the Cabinet approved the policy today.
Prime Minister Shinzo Abe's government is stepping up efforts to tackle the rising risks of tightening oil and gas supplies amid growing demand from China and India. Japan, which is increasingly reliant on nuclear energy, is seeking reciprocal relations with countries that produce the atomic fuel to strengthen energy security.
``Japan has yet to achieve and set out decisive measures to resolve the vulnerability of our energy security, given that it imports almost all its energy needs and that 90 percent of its oil requirements comes from the Middle East,'' the government said in the revised energy policy prepared by the trade ministry.
The policy contains other measures, including promoting energy saving, such as the use of biomass, fuel cells, ethanol- blended gasoline, and renewable energy like sunlight.
Recycling spent nuclear fuel and the development of fast breeder reactors will help the country boost electricity generated by atomic power plants from about 30 percent currently to above 40 percent, according to the energy policy.
``The government should have various measures to meet basic policies stated in the Nuclear State Plan,'' compiled in August last year, the revised policy said.
Nuclear State Plan
Japan's nuclear plan, prepared by the trade ministry's energy advisory committee, contains ways that allow the country to develop nuclear technologies, such as spent fuel recycling, the acquisition of overseas uranium supply, the commercializing of fast breeder reactor, and the provision of technical assistance to other countries building atomic power plants.
Nuclear fuel are ``spent'' when they can no longer effectively produce energy. Recycling spent nuclear fuel is central to Japan's energy policy as the global race for natural uranium intensifies. Uranium prices have jumped more than 10- fold in five years as demand from utilities surged and stockpiles fell. China, India and Vietnam all have plans to build atomic power plants.
Fast breeder reactors are designed to produce more nuclear fuel than they consume.
Russian Oil, Gas
The Japanese government reviews and revises the country's energy policy every three years, taking into account any major changes in the global market during the period.
The Cabinet's approval comes after the ruling Liberal Democratic Party and New Komeito gave their consent to the revised policy last month.
Heavy reliance on Saudi Arabia's oil and Indonesia's natural gas underscores the vulnerability of Japan's energy security. Japan's petroleum refiners and power utilities are increasing imports of crude oil and liquefied natural gas from Russia to break that reliance.
Nippon Oil Corp., Japan's largest refiner, and other petroleum companies last year began importing Sokol crude oil from Exxon Mobil Corp.'s Sakhalin-1 project in Russia.
Russia's natural resources ministry will begin ecological checks at the oil and gas project, Interfax reported, citing Oleg Mitvol, the deputy of the ministry's environmental inspectorate.
``I hope there will be no major impacts'' on the project from the planned inspection, Amari said, speaking at a regular press conference in Tokyo.
Oil Imports
In 2006, Japan imported 243 million kiloliters, or 4.19 million barrels a day, of crude oil, according to oil data compiled by the trade ministry. Imports from Saudi Arabia were 72.9 million kiloliters, or 30 percent of the total.
The country imported 62.1 million metric tons of liquefied natural gas that year, trade reports issued by the finance ministry said. Indonesia shipped 14 million tons to Japan, accounting for 23 percent.
LNG is natural gas that has been chilled to liquid form, reducing it to one-six-hundredth of its original volume, for transportation by ship to destinations not connected by pipeline. On arrival, it's turned back into gas for distribution to power plants and other buyers.
To contact the reporters on this story: Shigeru Sato in Tokyo at ssato10@bloomberg.net .
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