Japanese, Russian leaders expected to discuss Siberian oil pipeline

Senior Japanese and Russian leaders were scheduled to meet Thursday to discuss a proposal to build a 4,100-kilometer (2547 miles) crude oil pipeline from Siberia to Russia's Pacific Coast where it can be shipped to energy-hungry consumers in Japan.

Russia has also agreed to add a branch line to carry crude to China's northeast.

Japan's trade minister Shoichi Nakagawa will meet Russian energy minister Viktor Khristenko, according to a schedule provided by Japan's Foreign Ministry.

Japan is expected to provide soft loans to pay for much of the construction of the pipeline, now estimated to cost more than US$10 billion (Ђ7.6 billion) and expected to be put in commercial use in 2010.

Over the past two years, the two nations have held a series of expert-level talks, discussed three major issues _ a joint feasibility study on the pipeline's construction and environmental impact of the project, financing, and oil exploration in eastern Siberian fields.

Russia's state-owned pipeline operator OAO Transneft will be responsible for construction of the pipeline, and the Russian government has instructed the company to prepare a construction schedule by May.

The pipeline will follow a route from the town of Tayshet in Siberia's Irkutsk region through Skovorodino in the Amur region to the port of Perevoznaya in the Primorye region on the Pacific coast.

The pipeline is to have a capacity of 1.6 million barrels per day.

Environmental organizations have said a better site for the pipeline terminal would be Nakhodka, an active industrial port with existing oil terminals.

The Nakagawa-Khristenko talks were to be held ahead of a meeting of the Japan Russia Intergovernmental Committee On Trade And Economic Affairs scheduled for Friday.

Associated Press