Japan wants in on the natural gas supplies from Sakhalin I, a resource project off Russia’s Sakhalin Island. Sakhalin Island sits to the north of Japan’s most northern main island of Hokkaido.

US oil giant, Exxon Mobil Corp. recently signed an MOU with a Chinese firm to sell the natural gas to China via pipelines.

Japan does not like the pipeline approach because it is more costly, takes longer and construction of the pipelines cause social havoc. Japan prefers the gas in liquified form.

China just wants the gas. And…they will get it, via a pipeline.

There is room for negotiation but the battle for now seems clearly to have been won by the Chinese.

What do you think?