The Americas

Canada keen on boosting energy exports to Japan

Canada's Prime Minister Stephen Harper (R) shakes hands with his Japanese counterpart Shinzo Abe during a meeting in Harper's office on Parliament Hill in Ottawa, Canada on September 24, 2013.

Canada's Prime Minister Stephen Harper (R) shakes hands with his Japanese counterpart Shinzo Abe during a meeting in Harper's office on Parliament Hill in Ottawa, Canada on September 24, 2013.  (Pool/AFP)

Canada should boost energy exports to Japan as the resource-poor Asian country looks to diversify its fuel sources, their prime ministers said Tuesday.

They spoke after meeting with Canadian business leaders.

There are lots of areas for growth in Canadian-Japanese trade and investment ties but "one that came up most frequently is obviously energy," Canadian Prime Minister Stephen Harper said.

"Canada has considerable natural gas and it is the only country in the world that is a stable market-oriented producer of energy whose energy industry is also growing," he said.

"And Japan is the largest importer of energy in the world."

Harper spoke at a joint press conference with his Japanese counterpart Shinzo Abe, who was in Ottawa at the start of a five-day trip to North America.

Japan's national broadcaster earlier said Tokyo would consider giving assistance in the construction of pipelines and infrastructure to encourage the early export of liquefied natural gas (LNG) to Japan.

Those exports are likely to start around 2020, according to Kyodo News, while the Nikkei newspaper said they might begin in late 2018.

Japan, the world's third largest economy, is the world's biggest LNG consumer. But it pays a higher price for LNG than that charged in Europe and North America because Asian contracts are often long-term and linked to oil prices.

The trend has remained despite increasing global production of LNG, particularly in light of the US shale gas revolution, Japanese officials have said.

Hefty prices for LNG have hit Japanese utilities, which are now entirely without working atomic reactors because of a public backlash in the aftermath of the 2011 disaster at the Fukushima nuclear plant.

LNG-powered thermal plants used to provide about a third of Japan's electricity before the tsunami-sparked crisis. They now account for about a half.

A gas trade deal with Canada would follow an earlier agreement by the United States to ship shale gas to Japan from around 2017.

In Ottawa, Abe affirmed that Japan is looking to "secure a stable supply of LNG at competitive prices" and said Canada's energy supplies and Japan's energy demands are "mutually complimentary."

But no firm energy deal was announced.

Rather, the pair touted an agreement in principle allowing their respective militaries to share basic goods and services, such as fuel, water and facilities wherever both forces are deployed -- whether for training exercises, peacekeeping missions or humanitarian assistance operations.

They also called for boosting bilateral trade through an economic partnership agreement (EPA), soon to enter a fourth round of negotiations, and the Trans-Pacific Strategic Economic Partnership.

"I'm told we are making good progress" on the EPA, said Harper, adding: "Such an agreement would be a historic step in our relationship and will create jobs and long-term growth for both countries."

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