RIYADH, Sept 27: While the ongoing discussion with the oil majors is yet to reach a conclusion, Saudi Arabia has invited Japanese business houses to invest in its downstream and upstream gas sector.

Talking to the Japanese Trade Minister Takeo Hiranuma earlier this week, the Saudi Minister for oil and mineral resources Ali Al-Naimi proposed that the Japanese businesses should invest in the kingdom’s gas fields rather than oil, a senior Japanese official was quoted here as saying.

The offer by the oil and mineral resources minister was made in response to comments by Hiranuma, that Japan was interested in Saudi Arabia’s oil and gas fields.

Japan is one of the most dependent nations on imported sources of energy. Security of energy supplies is thus one of the most important goals of the Japanese government. The Japanese government and planners are weary of any oil shock.

During the recent International Energy Forum meeting in Osaka there was thus a great deal of pressure on Opec to increase the oil output. It was in this backdrop that Japan recently signed gas deals with Iran and Qatar to trim its dependence on imported oil. Oil meets about 50 per cent of Japan’s energy needs, while natural gas accounts for only 13 per cent of its requirements.

Until a couple of years back the Japanese company, the Arabian Oil Company (AOC) had the drilling concession for the Saudi-Kuwait Neutral Zone. But then both the governments because of differences with the Arabian Oil Company did not renew the concession.

The AOC was the only concession, which Japan had for drilling and has lost since then. It was, therefore, very eager to retain it.

The invitation of the oil Minister Ali Al-Naimi to Japan comes at a time when difficulties are being faced in finalising the deal between the oil majors and the kingdom on the $25 billion gas initiative.

Analysts feel that in case the ongoing discussions did come to a conclusion soon, the kingdom’s negotiating team may be forced to look at all the possibilities afresh.