Energy and Natural Resources
Oil, natural gas and iron ore - such energy and mineral resources are the underpinnings of economic activity. Yet Japan is dependent on overseas countries for most of its energy and mineral resources. Economic growth in BRICs and other new emerging economies has tightened the international resource markets, driving up the prices and intensifying a global "scramble for resources." Against this background, it is more crucial than ever for Japan to secure long-term and stable access to resources.
It is one of the highest priorities for JBIC to contribute to securing long-term and stable supplies of energy and mineral resources. A range of its financial instruments and schemes are utilized not only to finance oil, natural gas, iron ore and other resource interest acquisition and development projects in which Japanese firms participate, but also infrastructure development projects directly linked to such projects, including port and pipeline projects. JBIC is also strengthening ties with resource-endowed countries through business cooperation agreements with their governments. Here are some examples of the multifaceted support activities performed by JBIC.
Our way of life fundamentally requires the utilization of energy resources, such as oil and natural gas, and mineral resources, such as copper and iron ore, in various forms. For most of these resources, Japan has to turn to overseas supply sources. First, it is worth taking a look at the extent of our dependence on overseas resources and how soaring resource prices are affecting our lives.
JBIC has provided support in various ways to help secure long-term and stable supplies of resources amid increasingly intense competition for them. In this section, a classic example of what JBIC did to support this national effort is described respectively for oil and natural gas projects.
This section gives an account of representative examples of JBIC support for copper, aluminium and rare metals projects.
The New National Energy Strategy drafted by the Ministry of Economy, Trade and Industry in 2006 set the goal of "expanding the percentage of oil developed by Japanese companies in the total crude oil purchase from the current 15% to 40%." As one of the specific measures to accomplish this goal, the Strategy referred to diversification of crude oil supply sources. The promotion of oil development in Russia and the Caspian Sea is thus taken to be one component of the national strategy. JBIC has been involved in the following activities to secure resources from these new supply sources.
The traditional relations between Japan and resource-producing countries are primarily characterized as business ties built between the importers and the resource suppliers. This picture has changed. It is increasingly apparent that resource exporting countries earning huge sums of income, due largely to soaring resource prices, are now moving to elevate themselves from the status of resource suppliers. They are diversifying domestic industries, developing infrastructure, and seeking new investment opportunities outside their countries. The era when resources were bought and sold as ordinary transactions is over. What is important for Japan today--a country that depends on foreign countries for energy and mineral resources--is how it can become a partner for assisting the aspirations of resource-endowed countries in various ways that meet their needs. This section will depict JBIC efforts to build such multi-dimensional relations.
Amid ongoing global warming, energy sources that do not emit carbon dioxide, a major component of greenhouse gases, have been drawing growing attention. While securing supplies of such fossil fuels as oil and natural gas is important, it is crucial for sustainable economic development well into the future to secure access to other energy sources.