The Russian government has decided to build an oil pipeline from its eastern Siberian oilfields to the Pacific Ocean--as preferred by Japan--rather than through China, Russia's ambassador to Japan said on Friday.
"It's settled, there was a decision taken in our government," the envoy Alexander Losyukov told AFP following a question and answer session with about 100 businessmen, diplomats and journalists organized by the Yomiuri Shimbun daily.
"The pipeline will go to Nakhodka," a port in the Russian Far East facing Japan across the Sea of Japan (East Sea), the ambassador said, adding that the decision would be announced officially in the coming months.
A Japanese foreign ministry official said only that Tokyo had not officially been notified by the Moscow that the Nakhodka route had been selected.
"We know that there is such information as (Losyukov) has just said but officially we haven't received any information from the Russian government confirming that they have just chosen the route to Nakhodka, Jang.com reported.
"Of course the Japanese side is in favor of having the route to Nakhodka but we haven't received any confirmation from the Russian government," the official added.
Tokyo has been pressing for Moscow to construct a 4,000 kilometer-long (2,500 miles) pipeline to Nakhodka, from where the oil would be shipped to Japan and other Asia-Pacific nations, and has offered to finance the entire cost of construction, according to the Russian side.
China in turn has lobbied for about 10 years to persuade Moscow to follow a more southerly route, building a 2,400 kilometer-long pipeline from Angarsk in Siberia to Daqing in northeast China.
"We currently supply China with oil by rail and the amount is increasing. If there are enough (oil) resources, another pipeline will probably be built to China," Losyukov said.
"It's more advantageous for us to build on our own territory and to handle the marketing ourselves than to send everything to another country and in a sense, depend entirely on it.
"That's the principle behind the operation of any pipeline--it's preferable to have it on one's own territory and to dispose of everything running through it oneself," Lusyukov told AFP.
Russia is a major producer and resource-poor Japan and booming China are competing for access to its vast energy sources. China recently overtook Japan as the world's second largest oil consumer after the United States.
China has seen imports soar as flagging domestic production has failed to keep up with booming economic growth and demand from the auto market.
Japan, which imports virtually all its oil needs, is trying to reduce its dependence on the Middle East for supplies. Japanese companies last year signed deals providing them with natural gas from Russia's Sakhalin island for 20 years from 2007.
Losyukov's comment came as Chinese Premier Wen Jiabao is in Moscow at the head of a high-powered delegation for talks dominated by embattled oil major Yukos' decision to cut supplies to the Asian giant by September 28.
Wen, who arrived on Thursday, was also expected to push for Russia to give preference to a pipeline to China over the rival route to Japan.
"We hope that the Russian government gives priority to the construction of a pipeline in the direction of China which is the most stable market for Russian oil," Wen was quoted as saying by the ITAR-TASS news agency.
China plans to import 15 million tons of oil from 2006, according to the premier. The China route was backed by Yukos.
The rival one to Japan is backed by Transneft, the state-controlled oil monopoly and Yukos's rival.

Researchers say they have used spinach to harness a plant's ability to convert sunlight into energy for the first time, creating a device that may one day power laptops, mobile phones and more.

Eat your spinach, Mom used to say. "It will make your muscles grow, power your laptop and recharge your cell phone..."
OK. So nobody's Mom said those last two things.
But researchers at the Massachusetts Institute of Technology say they have used spinach to harness a plant's ability to convert sunlight into energy for the first time, creating a device that may one day power laptops, mobile phones and more.
Photosynthesis, the process by which plants use light beams for energy rather than eating food like animals, has been known to scientists for decades.
But attempts to combine the organic with the electronic had always failed: Isolate the photosynthetic proteins that capture the energy from sunlight, and they die. Inject the water and salt needed to keep the proteins alive, and the electronic equipment is destroyed, detnews.com reported.
That was until Shuguang Zhang, associate director of MIT's Center for Biomedical Engineering, discovered that protein building blocks called detergent peptides could be manipulated to keep the proteins alive up to three weeks while in contact with electronics.
"Stabilizing the protein is crucial," said Zhang, who collaborated with researchers from MIT, the University of Tennessee and the US Naval Research Laboratory, including electrical engineers, nanotechnology experts and biologists. "Detergent peptide turned out to be a wonderful material to keep proteins intact."
The scientists, whose findings were first reported by in NanoLetters, a publication of the American Chemical Society, then created a "spinach sandwich."

Why Spinach?
In reality, any number of plants could have been used. But the researchers chose spinach because "it is cheap and is easily available from the grocery store," Zhang said.
The spinach was ground up and purified to isolate a protein deep within the spinach cells.
A top layer of glass was coated underneath with a conductive material and a thin layer of gold to aid the chemical reaction. In the middle, the spinach-peptide mixture sits on a soft, organic semiconductor that prevents electrical shorts and protects the protein complexes from a bottom layer of metal.
By shining laser light on the "sandwich," researchers were able to generate a tiny current. While one device by itself can't generate much energy, billions of them together could produce enough electricity to power a device.
"It's like a penny," Zhang said. "One penny is not much use, but 1 billion pennies is a lot of money."
Practical applications are still a decade or so away, but the advantages include the technology's lightweight qualities, portability and environmental friendliness. "There is no waste," Zhang said.
The researchers suggest the technology could be used as a backup energy supply for battery-powered portable devices.

European natural gas demand will rise 65 percent by 2025.

BP Plc, the world's second-largest publicly traded oil company, said it expects global demand for natural gas to expand at about twice the rate of crude oil consumption in the next several years.
Gas demand may rise 2.5 to 3 percent a year through 2020, said Peter Hughes, vice president of strategy and portfolio at BP Gas, Power and Renewables, citing figures from the International Energy Agency. To meet that demand, as much as $1.6 trillion in investment will be needed in the gas supply chain, he said, bloomberg.com reported.
"The prospects for the gas business are very good," Hughes told McCloskey's European Coal conference in Nice, France. "We're anticipating that over the next five, 10, 15, 20 years gas demand will grow at roughly twice the rate of oil demand. At some point in the future gas is likely to overtake oil."
European natural gas demand will rise 65 percent by 2025, as utilities build more gas-fired power stations and favor cleaner- burning fuels, Global Insight Inc, an economic consultancy, said last week. Demand for liquefied natural gas in the US is rising as Canadian production falls. In Asia, Japan has boosted natural gas consumption because of nuclear power equipment failures.
As much as two-thirds of growth in demand for natural gas will come from the power business, Hughes said. The world will need an additional 120 billion cubic feet of gas a day by 2015 to meet demand. That's equal to 25 million barrels of oil equivalent, Hughes said.
Global proven gas reserves are equal to about 65 years of supply at current production levels.
"Most of it was found by my industry, which was an oil industry looking for liquid hydrocarbons and which found gas by accident," Hughes said. "The oil industry has not really started to look for gas specifically yet."

Tight supply and surging global demand will push Australian thermal coal export earnings up 43 percent in 2004/05 to almost $A6.3 billion.

The China story will play a big role in fueling a 43 percent lift in Australia's thermal and metallurgical coal export earnings in 2004/05, the nation's chief commodities forecaster said.
Tight supply and surging global demand will push Australian thermal coal export earnings up 43 percent in 2004/05 to almost $A6.3 billion ($US4.39 billion), the Australian Bureau of Agricultural and Resource Economics (ABARE) said on September 20.
"With significant new capacity coming on line during 2004/05, Australian export volumes of metallurgical coal are forecast to rise by nine percent to 122 million tons," ABARE said.
"Increased volumes and higher prices are forecast to result in Australian metallurgical coal export earnings rising by 43 per cent to over $A9.2 billion ($US6.4 billion) 2004/05."
Massive development underway in China would continue to have a significant impact on global markets, ABARE said.
That nation is swallowing vast amounts of metallurgical coal, otherwise known as coking coal, which is heated to create coke--an essential ingredient in the steel making process, news.yahoo.com reported.
Thermal coal is used as a fuel to produce steam for generating electricity and in manufacturing processes requiring heating.
A decision by China, the world's largest producer of coal, to reduce its coal exports to help satisfy its domestic demand would provide opportunities for other producers, particularly Australia and Indonesia.
China's thermal coal exports are forecast to fall by about eight percent to 74 million tons in 2004 at the same time as world thermal coal consumption is tipped to rise.
Infrastructure issues in South Africa and Australia mean that Indonesia is likely to snag the biggest slice of thermal coal exports in 2004, jumping 14 per cent to more than 87 million tons, ABARE said.
Spot thermal prices in the Asian market rose from $US35.69 a ton in January to about $US56.95 a ton in late August 2004.
Tight supply and strong demand are expected to provide continued support for prices in the short term, the forecaster said.
Growth in steel production is likely to push metallurgical coal demand up six per cent in 2004 and two per cent in 2005.
Australian capacity expansions will see its exports of metallurgical coal rise seven per cent in 2004 to almost 120 million tons and another five per cent in 2005 to almost 126 million tons.

With crude prices at record highs and the winter heating season just around the corner, Wall Street is having a hard time dismissing worries about rising energy costs.
A number of companies have cited oil prices as they've issued third-quarter profit warnings and reports, and anxiety about crude, which neared $50 a barrel last week, has weighed heavily on stocks. There's good reason to worry: Energy costs are crimping profits at manufacturers, forcing airlines to cut flights and threatening consumer spending.
Still, some analysts are skeptical about the true impact oil will have on earnings. While the cost of crude is uncomfortably high, the prices of refined products used by consumers and businesses, such as gasoline and natural gas, have not surged at the same pace. That's because their costs are generally tied to inventory levels, rather than crude prices. But for companies that might be in danger of missing expectations, oil could seem like a handy excuse, AP reported.
"Let's face it, if earnings comparisons don't work out too well, they look for scapegoats," said Sam Stovall, chief investment strategist with Standard & Poor's. "If energy prices are in the news, it's easy to blame it on them."
One in five companies say lofty oil prices are hurting their earnings, according to a survey issued this past week by Financial Executives International and Baruch College's Zicklin School of Business, and 36 percent of manufacturers have reported a negative impact. But two-thirds of chief financial officers surveyed said earnings are not tied to the price of oil in any significant way.
Those feeling the pinch include the highest energy consumers--air transporters, who must pay more for diesel fuel, makers of agricultural products like fertilizer, and chemical producers. If you look around, you start to realize energy really is everywhere. Petrochemicals are used to make everything from plastic and synthetic fibers in clothing and carpets to vinyl siding on homes.
"Underneath the surface, what businesses and consumers really spend their money on is refined product, and those prices have been coming down," said Jeff Kleintop, chief investment strategist for PNC Financial Services Group in Philadelphia. "Fed Ex doesn't put crude in their trucks."
There are essentially two ways energy prices can affect corporate bottom lines: They can raise business operating costs and, to the extent that they impact consumer spending, dent sales. Some retailers, including Wal-Mart Stores Inc., have in recent months blamed lower-than-expected results on slow consumer spending.
After gasoline prices peaked in mid-May, that might have been genuinely true, Kleintop said. It makes sense that lower-end retailers would see the effects first, because rising energy costs have a greater impact on their customers. But there's some reason to believe the worst is behind them, as gas prices declined through the summer and unseasonably cool, wet weather kept utility bills modest.
That doesn't mean consumers won't feel another pinch in the months ahead. Heating oil prices are on the rise, and refiners are racing to build up supplies following production slowdowns in the wake of Hurricane Ivan, which disrupted drilling and shipments from the Gulf of Mexico. But at this point, if companies that are not big energy consumers blame less-than-stellar results on high oil prices, it would be wise to view their statements with a jaundiced eye.
"We'll see a number of companies that are second or third tier in their industry, and if they're going to miss expectations, they'll cite energy costs," Kleintop said.