AZERBAIJAN, JAPAN NEARING OIL CONTRACT.

The Japan National Oil Company (JNOC), Itohu, and two other Japanese firms signed a memorandum of understanding over the weekend with the State Oil Company of Azerbaijan concerning the development of three offshore oilfields in the southern part of Azerbaijan’s sector of the Caspian Sea. Soviet-era prospecting in that area had failed to tap deposits that lie at depths of up to 100 meters underwater. JNOC will be operator of the project, which is to be financed on credit by the Japanese government and banks. If signed as expected, this will be the first contract between Azerbaijan and an all-Japanese consortium, signifying Japan’s massive entry in the Caspian oil business. The Itohu company pioneered the trend in 1995 by acquiring a small share in the "contract of the century." (Turan, Petroleum Information Agency, March 15)

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