International experts consider Russian-Japanese interaction in energy sphere perspective

November 13, 2013 12:08 pm

A number of problems associated with the leak of radioactive water from Japan’s Fukushima nuclear plant continue to worry the international community and increase the number of Japanese citizens who actively advocate for the complete abandonment of nuclear energy. However, representatives of the expert community have repeatedly stated that the alternative energy sources would not be able to fully cover the energy needs of Japan experiencing a shortage of electricity after all nuclear reactors of the country were shut down. According to some analysts, this problem may be resolved through the enhanced interaction with the Russian Federation, which, for example, offers cooperation within the oil and gas projects on the island of Sakhalin under production-sharing agreement. However, there are some difficulties in this area as well.

FukushimaCommenting on the situation in Japan, one of the leading energy experts Justin Dargin said that when all the fifty nuclear reactors had shut down the Japanese government started to search the ways to improve the country’s energy situation by encouraging the development of renewable energy.

“One option that is being considered is promoting the development of wind energy that would benefit from the long Japanese coastline. Japan has deployed floating windmills that will be operational next month. The Japanese government has an ambitious goal to generate more than 1 gigawatt (about the same amount that a nuclear reactor would generate) of power from approximately 140 wind turbines,” the analyst said in an interview with news agency “PenzaNews.”

At the same time, he stressed that the Liberal Democratic Party (LDP) had not abandoned nuclear energy forever as an important source of energy for Japan’s industrial economy.

“The LDP has formulated plans to dramatically overhaul the country’s nuclear sector by combining all of the country’s fifty nuclear reactors into a single operator. While this plan is still being discussed, it is part of a larger move to allow a comprehensive restructuring of the energy sector,” the expert noted.

In his opinion, LNG export from Russia to Japan is critical for Japan to continue to meet its domestic energy needs in the face of dwindling power supply as its nuclear plants are shutdown.

“Japanese and Russian cooperation is essential for both countries to meet some of their economic goals. For nearly a decade, Japanese and Russian cooperation has been stagnant with limited outreach. However, this bilateral relationship reinvigorated itself when the two countries held a summit in April 2013,” Justin Dargin said.

“This outreach reveals a Russian focus on the East as a means to diversify its energy sector in the face of various political and economic differences with Europe. Russia also requires guaranteed markets for energy export, importation of advanced technology and foreign investment in its Far East. As a result, increased economic cooperation with Japan would significantly assist Russia in meetings these goals. Additionally, Japan, for its part, which has experienced increased hostility with North Korea and China, is interested in increased political, economic and energy cooperation with Russia. Furthermore, in light of the nuclear shutdown, access to Russian energy would be of an enormous benefit to Japan,” he added.

While the Sakhalin projects have been beset by delays and certain disagreements among the stakeholders, according to the expert, it has a prodigious amount of oil and natural gas reserves and is therefore well situated to supply regional and global energy needs.

“With the still robust economic growth in the BRICS countries and some optimistic signs that the world economy will recover in the midterm, energy assets from the Sakhalin project are poised to play a crucial role to help meet world energy needs. Given the energy needs of Russia’s neighbors, my outlook for the successful and continued development of the Sakhalin projects is quite bullish,” Justin Dargin concluded.

In turn, Professor of Slavic Research Center at Hokkaido University Osamu Ieda, who is conducting comparative research of Chenobyl and Fukushima, stressed that the energy situation in Japan is not critical.

“If we speak about something serious, it would be the exchange rate of Yen. Due to the unfavorable exchange rate of Yen, the price of energy resources like oil is much higher than before. The power stations in Japan consume huge volume of imported oil and gas,” he explained.

Meanwhile, according to him, it is still unknown what energy resources the country will use in the future because there is no common opinion on this issue either in the government or in the social circles.

Russian-Japanese energy“We may say that in the long run we should give up the nuclear energy, partly because the majority of the population prefers non nuclear energy, partly because the resource of the nuclear energy, uranium, is very limited – they say that the reserves of uranium are much less than that of oil. So sooner or later, in this century, not only Japan but also other countries have to face the lack of nuclear resources,” he said and added that people still have no solution how to keep the nuclear waste safely for centuries and millenniums.

At the same time, the topic of Sakhalin projects, in his view, is purely political, not economic.

“However, I hope that the political issue shall be solved as soon as possible. We have no reasonable and rational ground to prolong the solution,” Osamu Ieda noted.

Spokesman for the Tokyo-based Citizens’ Nuclear Information Center (CNIC) Hajime Matsukubo also considers the interaction of Russia and Japan in the oil and gas projects important.

“Our group is strongly against NPP restart and we think Japan should promote the introduction of renewable energy. But in middle term, we have no choice but to depend on natural resources such as gas, oil and coal. In this regards, Sakhalin-2 and 3 is quite important project for Japan,” he said.

Hajime Matsukubo stressed CNIC is against NPP because this system is based on mass production, mass consumption and mass disposal, and is very dangerous.

“Once severe accident happens, hazardous radioactive materials emits to the environment. Even at normal time, NPP requires radiation exposure from Uranium mining to maintenance. I can see the same kinds of things at Sakhalin project. So this project is very important one, but need to be treated more carefully,” he added.

Keun-Wook Paik, Senior Research Fellow at the Oxford Institute for Energy Studies, expressed the opinion that the Fukushima disaster delivered a massive blow to Japan’s energy planners as Japan’s public opinion on the nuclear energy option is not positive due to the poor management of the Fukushima reactors.

“As the financial burden of the complete shutdown of the nuclear reactors indefinitely is and will be too high, Japan’s energy planning authority like METI is struggling to find a way to compromise the burden. At the moment, the very best option is to increase the use of LNG for power and coal for power, but the cost of increased LNG is excessive. This is the reason why METI officers are ruling out the complete suspension of the nuclear energy option,” the expert noted.

Speaking about the importance of the Sakhalin projects for Japan, he stressed that Tokyo is the biggest consumer of the LNG from Sakhalin-2.

“Currently Sakhalin-2 is producing the maximum LNG – almost 11 mt/y. Shell is urging Moscow authority to consider the expansion scheme of the current 2 trains LNG production, but the project itself has no gas supply sources for the expansion. To add one train (5 mt/y) capacity, the gas should come from either Sakhalin-1 or Sakhalin-3, but the chance looks slim. Sakhalin-1 project wants to develop its own 1-train LNG production scheme, while Gazprom aims at supplying the gas to Primorskii Krai for the gasification of the region. If the production from Sakhalin-3 is big enough, it could be supplied for Vladivostok LNG. Reportedly, Sakhalin-3’s Kirinski project started its production but the scale of production will be modest in the early stage. It remains to be seen how quickly the production can be increased. In my view, it is a nonsense to supply the gas to Primorskii Krai for the regional gasification scheme. It would be much better supplying the gas for Sakhalin island’s local use or Sakhalin-2’s LNG expansion scheme. Primorskii Krai’s gasification scheme and Vladivostok LNG scheme should be taken care by the pipeline from Chayandinksoye gas field and Kovykta gas field,” Keun-Wook Paik said.

Russian-JapaneseProfessor Satoshi Konishi from the Institute of Advanced Energy, Kyoto University, said that although energy supply without nuclear power that fed more than 30% before the accident is very much concerned, it is rather stable.

“Nuclear energy, when the plants are reinforced for further improved safety, is one of the candidates to play significant role in the energy mix, but it will depend on considerable political discussions from public to governmental level. Some old reactors that will not meet the much strict safety regulation will be shut down. Alternative sources such as solar, wind or geothermal will strongly be promoted, but their amount will not be very significant,” the analyst said.

At the same time, in his opinion, gas resource in Sakhalin is a very interesting and meaningful possibility for both Russia and Japan.

“The collaboration between two countries will be attractive. Japan can provide Liquid Natural Gas and its transport technology, while Russia can provide the resource. That will be a promising business chance for both countries and much more development possibility for Far East area,” the expert said.

According to him, there certainly are some delicate political and diplomatic issues in the area – for example, the two countries have not signed the treaty of peace, and the agreement on the territory was not made yet – but Tokyo regards the Sakhalin projects as a very good chance to promote mutually beneficial cooperation between Russia and Japan.

“Joint development program in Sakhalin will, if everything goes well, also promote the good relationship between the two countries,” Satoshi Konishi added.

At the same time, he stressed that resource is only a part of the energy issue, and current energy systems in the world emphasize technology as more important, even for oil or natural gas.

“Pipeline and LNG technology are essential for gas supply. Nuclear and renewable energy is even more dependent on technology. Both Russia and Japan are leading countries in these fields, and should collaborate for better future of the mankind,” the analyst concluded.

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