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. Japan says Iran oil talks winding down
TOKYO, Oct 3 (AFP) Oct 03, 2006
Japan's trade minister said Tuesday that talks were almost over with Tehran on whether to go ahead with a two billion-dollar contract to develop Iran's largest onshore oil field.

Japanese media have reported that Tokyo is ready to give up the mega-project due to frustration over Iran's nuclear program and Tehran's repeated threats to cancel the deal.

"Negotiations are literally entering the final stage," Trade and Industry Minister Akira Amari said at a news conference in Tokyo.

"I don't think we can afford another month. I presume we are going to settle the issue earlier than that," said the newly appointed trade chief in the cabinet of Prime Minister Shinzo Abe.

Asked if he was optimistic, Amari said: "At this moment, we cannot announce a conclusion with premature predictions."

Iran on Monday again warned that if Japan did not quickly confirm its commitment it would find another partner to develop the Azadegan oil field in southwestern Iran close to the Iraqi border.

The deal is seen as important for Iran's standing in the world at a time when it is threatened with United Nations sanctions over its nuclear program to add to the strict US trade embargo it already endures.

The contract was signed in 2004 by Inpex Corp., a Japanese oil exploration company that is supported by the government but also has private stakeholders.

Japan, the world's second largest economy, is nearly entirely dependent on the Middle East for its oil and imports 15 percent of its needs from Iran.

It has previously resisted pressure from the United States, its closest ally, to cancel the deal.

But press reports here said that Japan, the only nation to suffer nuclear attack, has been frustrated by Iran's refusal to comply with a UN Security Council resolution demanding it end uranium enrichment.

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