Tokyo - Japan announced Wednesday it had reached a final
agreement with China for a joint natural gas exploration project in the
Chunxiao and Longjing fields in the disputed East China Sea.

The two governments also agreed on a joint project in another
undeveloped area, and to continue talks on possible other joint
projects, but postponed a decision on drawing precise exclusive
economic zone boundaries.

Japan and China plan to start talks on a treaty, the Japanese
government revealed at a press conference held by Foreign Minister
Masahiko Komura and Finance Minister Akira Amari.

Japan would invest in a Chinese company, which has already started
exploration in the Chunxiao field - one of the four gas fields located
on the demarcation line claimed by Japan.

China would take profits proportional to the size of investment it
has already made. The two nations would divide investment and profits
in the project in the Longjing field.

They would continue talks on two other undeveloped fields.

China does not recognize the Japan-claimed median line and instead
claims its exclusive economic zone stretches further east to the edge
of the continental shelf, near Japan's southernmost Okinawa island. (dpa)