China and Japan try again to resolve sea dispute

BEIJING, May 25 (Reuters) China and Japan today began new talks aimed at settling their sea territory dispute, with the two Asian powers considering ''joint development'' of disputed energy reserves but showing no compromise on defining the border.

Both sides are eager to secure oil and gas supplies but disagree over where the sea boundary separating their exclusive economic zones should lie.

Development in the East China Sea has long fuelled tension between the two neighbours, just one of several bilateral disputes, most dating back to Japan's invasion and brutal occupation of parts of China from 1931-1945.

Japan objects to Chinese development of undersea gas near what Tokyo calls the border. Although the Chinese drilling is in an undisputed area, Tokyo fears the development could drain gas from its side by tapping into geological features that reach into areas it claims.

During a bridge-building visit by Chinese Premier Wen Jiabao to Japan last month, the two nations agreed to intensify talks over developing oil and gas fields in the disputed waters and to propose concrete measures by autumn.

The China Daily, an English-language paper that generally reflects government thinking, said today that the talks would test ''the two countries' dramatic ice-thawing talks in Tokyo last month'', referring to Wen's visit.

There were no signs of major breakthroughs before the talks opened. Seven previous sessions since 2004 have produced little progress, the China Daily also noted.

Although the two have talked about the possibility of joint development for years, they have each handed out unilateral exploration permits for border areas.

Yesterday, a spokeswoman for China's Foreign Ministry said the government remained adamantly against Japan's position that the boundary was defined by the mid-point between the two countries' coasts.

''China's stance in this regards is also extremely clear and has not changed,'' spokeswoman Jiang Yu told reporters.

''The so-called median line is Japan's unilateral proposal, and China has not and will never accept it, and will not accept the median line as the basis for discussing joint development.'' Beijing says the boundary is defined by its continental shelf, extending its claimed zone well beyond the median line.

China's CNOOC Ltd. also confirmed in April that it has begun producing gas at a field in the sea despite Japan's objections.

CNOOC's gas output from the Tianwaitian field last year was equivalent to a relatively modest 4 million cubic feet per day, the company said in its annual report.

But an industry source said at the time of the disclosure that actual output was then running at 500,000 cubic metres a day (17.65 million cubic feet).

REUTERS AE RAI1015