 Good afternoon, everyone. Welcome to the resumption of Japan in 2018, here at the Carnegie Endowment for International Peace. I think our microphone should be on. I'm the entertainment here for a brief moment while we all assemble and get ready to start our keynote speech. Basically my job here is just to introduce the introducer. Matt Goodman is here with us today. He's the chairman of the board of trustees at the Japan-America Society of Washington DC. A good friend, obviously a great scholar on Japan and economic trade issues at CSIS, here in town and a long career in government as well and serving both here in Washington and in our embassy in Tokyo. So Matt Goodman, let me turn it over to you. Thank you. Thank you, Jim. And it's nice to see such a great crowd here for our special event here that we do once a year. Again, I'm Matthew Goodman. I chair the board of trustees of the Japan-America Society and we're delighted to do this event, Japan in 2018, in partnership with Carnegie. Thank you for hosting. Thanks to the KZI Coho Center and NAJAS for helping make this event possible. And thanks to all of you for coming. We always look forward to this event because it's our one chance to really look ahead to U.S.-Japan relations and developments in each country and to make a few predictions, which we can then question at the end of the year whether how well we did. I have a simple job here today which is to introduce our keynote speaker. And I'm delighted to introduce Hirayuki Tsurugi who is the executive managing officer and chief operating officer of the Energy Business Unit 1 of Mitsui and Company, which is a household name company in Japan, one of the oldest and most distinguished companies in Japan and which does a lot of things. It's a general trading company that does almost anything you can think of, including working on energy related trade and developing energy markets and investing in that sector. Generally, Tsurugi-san studied at Kyoto University in the faculty of law and international politics and joined Mitsui and Company in 1984. And he's been in a number of energy related positions at the company over the next 30 years. And he's now, as of April of last year, he has been in this position as executive managing officer and we're delighted to have him with us to cover a subject that we, let's be honest, me, it's a topic that I don't know much about and so I always find those the best kinds of conversations because I always learn something. So I'm very much looking forward to hearing from Tsurugi-san. Please join me in welcoming him to the stage. Thank you very much. I grew into Washington, DC yesterday on direct flight from Narita. And last night I could sleep only two and a half hours due to heavy jet lag. And you can imagine that I'm feeling very sleepy, especially after lunch. But I would try my best to keep me awake while I'm speaking. Well, it's a great pleasure for me to visit Washington, DC on the occasion of this NIGES and KKC business speaker series to discuss what the new year of the dog holds for Japan and for its future relationship with the United States. I'd like to take this moment and extend my sincere appreciation to the members of National Association of Japan-American Societies and Japan-American Society of Washington, DC for the hard work and effort that they have put in place for the betterment of U.S.-Japan relations and to the Carnegie Endowment of International Peace for co-organizing this event. Before I begin, please allow me to briefly introduce my company and myself. Mitsuyen Company Limited is a Japanese trading and investment firm engaged in multi-industries, ranging from ICT, healthcare or foodstuff to mining, infrastructure and energy. In relation to the U.S., the Mitsuyen name has had a long history, which spans over 138 years. In 1879, our predecessor company, or the former Mitsuy, set up its first office in New York, which was three years after its establishment in Japan. Mitsuy quickly became a key player, particularly in the silk and cotton trading businesses. In the 1970s, the current Mitsuy has invested in projects and formed partnerships, making headway in the development and expansion of various businesses in the U.S., such as a petrochemical terminal, for example, Intercontinental Tunner's Company, nutrition for animal feed supplement, for example, Nobus, food services and products, for example, Ventura Foods, mobility and logistics services, for example, Pinscale Automotive Group, field manufacturing, for example, Nucor, and so on. Over the last 10 years, Mitsuy has invested and financed in the U.S. over $19 billion, with total employment of over 70,000, and has 175 affiliated companies in this country. In the energy sector, starting from the acquisition of shell gas assets in the Marcellus area in Pennsylvania, we have been increasing our investment in the U.S. including the Cameron LNG project in Louisiana, of which construction of gas processing and liquefaction facilities are ongoing at the moment. In fact, you can see that Mitsuy's increase in its investment portfolio has been in line with the trend of Japan's increasing direct investment in the U.S. As I started my career in Mitsuy in 1984, and I am currently COO of the Energy Business Unit, my career of over 30 years includes development and operation of LNG projects, such as the Australian Northwest Shelf Project and Abu Dhabi LNG project in the Middle East. I have also been involved in the exploration and, sorry, the expansion of Mitsuy's global oil and gas upstream business, also called EMP business. As a businessman who has been engaged in trading and investment activities in the energy sector for the first three decades, today I'd like to share with you a view on what type of role energy could possibly play in forging U.S.-Japan relations. First, I'd like to turn your attention to where Japan's energy situation is positioned today in order for us to understand better the current status and the future possibilities of U.S.-Japan energy relations. While Japan is dependent on importing most of its fossil fuels, which form the foundation of Japan's primary energy supply, the country has been promoting nuclear as one of its base load power generation sources. The ratification of the Kyoto Protocol in 1997, which was the first international framework related to the reduction of greenhouse gas emission has also contributed to the country's positioning of nuclear power as a core of Japan's energy policy and the recent agreement of the Paris Climate Accord as further strengthened Japan's need to increase the share of green energy in the total energy mix. However, since post-2011, where we experienced the Fukushima Nuclear Power Plant Accident, which occurred after the Great East Japan earthquake, the government and the private sector have together been promoting to control energy demand and to achieve the best power source mix based on the strategic energy plan that was set out by the Agency for Natural Resources and Energy back in 2014. The key words that form the basis of Japan's energy policy are energy security, economic efficiency, environment and safety, which is also known as 3E plus S. Through maximizing energy conservation, the country plans to maintain total power generation in 2030 to the level of 2013, which is 967 million megawatt hours. The assumed energy mix here is 27% RNG, 26% coal, 23% renewable energy and 21% nuclear. And it is important to conduct optimum and holistic energy management and compassing all energy sources and the elements of 3E plus S into the system. With respect to RNG and coal, which form the core of the base load fossil fuel generation for Japan, the country plans to continue effective utilization whilst achieving both high efficiency and low environmental impact at the same time. Let me remark in passing that Japan currently depends on the Middle East for 26% and Asia Pacific region for 74% of its total energy import respectively. But it is moving to diversify its supply sources primarily through the introduction of US RNG into its portfolio. Mitsui's energy business in the Asia Pacific region, in particular our RNG business activities, has had a long history which dates back to 1970s when we first participated in the Abu Dhabi RNG project in the Middle East. Since then, Mitsui has been delivering RNG to Japan and has been playing a key role in the maintenance of energy security in our country. We also started to participate in the Australian RNG project about 30 years ago and are currently involved in eight RNG producing projects delivering RNG mainly to the Japanese market. As I mentioned to you earlier, in the US starting from next year, we plan to commence delivery from the Camelon energy project in the state of Louisiana. With respect to renewable energy, the challenge remains over relatively higher costs compared to other countries for solar and wind power and putting in place necessary infrastructure such as transmission lines in order to utilize renewable energy as one of the primary sources of power generation in our country. Last but not least, with respect to nuclear power, out of total 48 nuclear reactors in our country, so far, 14 have obtained approval from the Nuclear Regulatory Commission for restart. And out of this, only four have resumed commercial operation. In some areas close to the nuclear power plant site, we have seen legal actions by the local communities to shut down the operation of the reactors due to alleged safety concerns. And it may be challenging to achieve the 21% share of nuclear power by 2030, which is a goal that has been outlined in the strategic energy plan. One inactive reactor is equivalent to around 320 to $570 million worth additional cost. And an increase in CO2 emission worth 260 to 490,000 tons per year, which poses a major issue surrounding Japan's long-term energy strategy. When we shift our rise to the wider Asia-Pacific region, the story changes completely. Backed by the growth of population and GDP in the region, both primary energy consumption and power generation are expected to increase by around 50%, between 2015 and 2030. And the scale and the speed of growth are expected to continue increasing into the long term. The primary energy source which supports this growth is expected to be coal-fired power generation. All is expected to remain as a main player in the power sector for long term in countries such as China, India, and Indonesia. Backed by large population, existing domestic production, and market for coal consumption. On the other hand, the issue of air pollution, such as fine particulate matter, also known as PM 2.5, is becoming imminent in major cities in China and India, which has led to increasing interest in and activities dealing with environmental issues throughout Asia. We foresee that the demand for power generation, which utilizes clean coal technology will continue to increase. In particular, there are moves to install facilities to remove sulfur, nitrogen, and dust particles. However, the issue remains as to who would be capable of financing power generation facilities with low environmental impact and high efficiency, or introducing relevant carbon capture, utilization, and storage technology into the system. Both of which are still very expensive. For that matter, technological and financial support from the OECD member countries continues to be indispensable. Under the Paris Climate Accord, the goal for greenhouse gas emission reduction for 2030 compared to 2005 by each member country has been set at very high standards. China, 60 to 65%. India, 33 to 35%. And Indonesia, 29%. In order to achieve this outcome, large-scale introduction of renewable energy and implementation of energy conservation are inevitable. The Asia Pacific region continues to be the world's largest consuming market of primary energy. And the source of energy supply required to satisfy the rapid demand growth in this region, which is also home to major environmental issues and concerns remains to be a major global issue. One solution to this would be natural gas and energy. And in fact, in the past few years, we have observed increasing interest amongst emerging market in the Asia Pacific region for the introduction of natural gas and energy into the energy mix. There are abundant and diversified sources of supply for energy with US share gas based energy being one of the main contributors for the future supply of energy to the global market. I'd like to share with you one example of how Mitsui is responding to the growing demand for natural gas in the Asia Pacific. Mitsui is currently involved in developing the gas value chain in Vietnam. We conduct joint studies with Vietnam Oil and Gas Group or Petro Vietnam, a state-owned oil and gas company, which involves the supply of energy and construction of energy receiving terminal and development of gas-fired power plant in the southern part of the country. During the APEC summit, which was held last November in Danang, Vietnam, we signed a memorandum agreement with Petro Vietnam. In the presence of Vietnamese president, Chan Dai Kwong and Japanese Prime Minister Shinzo Abe. In order to expand Vietnamese domestic energy demand and to promote consumption of cream fuel, we believe that Vietnam's energy demand should increase. The country is moving to establish a regulatory framework related to energy import and plans to install five to six energy receiving terminals in order to import six to 10 million tons per annum of energy between 2026 and 2035. Vietnam is one of the emerging market in Asia and given the need to gain experience in the energy business and to promote growth of the domestic energy industry, that country welcomes collaboration with Japanese companies who have expertise in this area. Now, let us turn our attention back to Japan and share with you the history of U.S.-Japan relations and the areas of joint collaboration in the field of energy. I'd like to start off with the types of investment in the energy sector that Japanese companies have made in the U.S., in particular in the area of energy, and elaborate on how the U.S. and Japan could further expand this relationship on a wider global scale. With respect to Japan's direct investment to the U.S., we have seen a steep increase in investment in the mining sector since 2010, whose position has been over eight to nine billion dollars over these past few years. We can see that the U.S. share gas revolution was one of the main contributors to this boom. Regarding Japan's investment in energy projects or participation in the liquefaction tolling capacity in the U.S., there are currently three projects. Namely, Kameon LNG by Mitsui and Mitsubishi, Co-Point LNG by Sumitomo and Tokyo Gas, and Freeport LNG by Chubu Electric and Osaka Gas, and the liquefaction capacity of the three projects combined totals 30 million tons per annum. From the Kameon LNG project, Mitsui plans to export around 4 million tons per annum of LNG from 2019, mainly to markets in Japan and Asia Pacific. In Asia Pacific, it is focused that demand for natural gas for ASEAN members countries and India by 2030 would amount to 2.5 times the demand in 2015. However, in order to achieve the golden age of gas which has been proclaimed by the International Energy Agency or the IEA, we would have to introduce more LNG related infrastructure to this region. It is estimated that this would require more than 80 billion dollars of additional investment. At the time of the LNG producer consumer conference 2017, which was held in Tokyo, October last year, the main theme was issues and policy related to expansion of the LNG market in the Asia Pacific. And Mr. Seko, Japanese Minister of Economy, Trade and Industry announced over 10 billion dollars of financial support to help this cause. In addition to this, Japan also agreed to provide human resource development for 500 people over the next five years in countries which are newly importing LNG. Currently in Asia, countries such as Myanmar, Vietnam and the Philippines are planning to become new LNG customers. Furthermore, India, Indonesia and Thailand considering expansion of receiving capabilities. And we believe that Japan can play a role through the support that it can provide to these countries. In order to further expand the Asia Pacific LNG market, LNG has to be competitive vis-a-vis coal and renewable energy. In order to maintain its competitiveness, the industry requires technological advancement in areas such as packaging of FSRU or floating storage and regasification unit together with power generation facilities or modularization of LNG facilities. In addition, most of the long-term energy contracts to Japan have destination restriction clauses and such condition where appropriate needs to be revisited if we were to achieve further expansion of the LNG market in this region. One example in FSRU business which Mitsui is involved in is the long-term chartering of FSRU in Pakistan. In November 2017, Mitsui obtained 49% share of FSRU chartering business for Pakistan. While we expect depression of domestic natural gas supply in Pakistan, we also expect to see an increase in the demand for natural gas. For this reason, the country started to import LNG in 2015. However, even the robust demand for gas, it is expected that Pakistan's LNG import demand shall increase to around 20 million tons per annum by 2022. The long-term chartering business that we are involved in shall play an important role in building the future energy infrastructure for Pakistan. How then can the US and Japan work together to further collaborate in the energy sector in order to strengthen the energy partnership between Japan and the US? Last November, both countries agreed to progress JUSEP or Japan United States Strategic Energy Partnership in the framework of bilateral economic discussions. In addition to promotion of advanced nuclear power technology and high efficiency low emission coal technology, the priority for this year's activity plan includes the introduction of global natural gas market and the development of energy infrastructure which promotes regional integration of emerging markets. By utilizing the abundant energy resources from the US, the Japanese private sector can contribute by exporting and marketing competitive US LNG to the global market. Furthermore, in collaboration with export credit agencies such as the Japan Bank for International Corporation or JABIC and Nippon Export and Investment Insurance or NEXY, we can assist in establishing necessary energy infrastructure in the Asia Pacific which could contribute to further demand creation in this region. Now let me touch briefly on the policy of nuclear power which remains to be an extremely important issue for Japan. The US and Japan have had a long-term relationship in the area based on the bilateral agreement for cooperation concerning peaceful uses of nuclear energy through R&D related to nuclear power and overseas market development. Maybe desirable for the industry to consider expanding the scope of cooperation to decommissioning of nuclear reactors. The know-how associated with decommissioning in the US is extremely valuable for Japan since our country plans to decommission its reactors in the foreseeable future. In this context, we believe that the need for US-Japan cooperation will be increasingly important over the coming years. Next, when we consider expansion of imports and export activities of fossil fuel between the US, Japan, and Asia Pacific region, efforts for collaboration may have to extend to building the future energy infrastructure such as energy receiving terminals and creating energy demand in the Asia Pacific. As we believe that there is room for cooperation between the Japanese private sector who has financial capabilities and experiences and the US which also has financial capabilities and relevant technology. In particular, even that US LNG does not have destination restriction, we believe that increased production of US LNG shall lead to further expansion of the market. And through this, we can contribute to energy security in the Asia Pacific region. Furthermore, in order to further strengthen energy security in the Asia Pacific region, engagement with China, which retains the greatest potential demand and influence over the region, would be very important. Both Japan and China are major gas consumers in the Asia Pacific and both countries are expected to inevitably benefit from US LNG supply in the future. This is because if US gas starts to throw into the Asian market, then the flexibility of gas in the area will increase, leading to greater transparency and more competitive market due to the diversification of supply sources. As the Asian energy market grows, each country would aim to secure stable gas supply which would in turn contribute to reinforcement of energy security in the region. The important point for engagement with China is that with respect to energy trade for and relevant infrastructure development, the US and Japan need to involve China under a sound legal framework. We hope that Mitsui, through our business activities in the energy sector, can play a role in further strengthening this relationship as well. It is our sincere wish that this would in turn need to sustainable growth of the industry and the energy market in the Asia Pacific. As you can see from just a few examples that I have outlined today, through close collaboration between the US and Japan in the energy business, we foresee great opportunities ahead which could in turn help to improve and maintain the delicate energy security balance in the Asia Pacific region. In particular, we are keen to pursue the type of cooperation between the US and Japan through development and marketing of LNG to both new and old players in the emerging market. In this respect, we believe that Japan's private sector, including Mitsui, can play a role in making changes happen in the energy sector and thereby contributing to strengthening of not only the bilateral relations between the US and Japan, but multilateral relations with our neighboring countries in the Asia Pacific region. Thank you very much for your kind of attention. Thank you very much, Tsurugi-san. That was a very comprehensive and terrific overview of this whole area of cooperation. I'd like to invite Matt and the panel up because we wanted to take advantage of Tsurugi-san's speech and expand upon that topic and that dialogue with a group please. I'm filling in the time while you come up and I'm gonna turn it over to Matt, but we had a, rather than just leave the talk there, we wanted to continue and build upon it with a little deeper discussion, so I'll turn it over to Matt. Okay, thank you, Jim, again, and I'm back. Thank you, Tsurugi-san, for a very rich presentation with lots of food for thought and also for discussion, and that's the purpose of our team up here. We have a great panel, all of whom, each of whom, I have had the pleasure of working with in one capacity or another, and who I know are just very knowledgeable and expert and great presenters on this set of topics, so let me first as quickly introduce them. Jane Nakano is my colleague with my other hat on, not the Japan America Society, but at the Center for Strategic and International Studies. She is Senior Fellow in the Energy and National Security Program at CSIS. She's an expert in U.S. energy policy, LNG markets, global nuclear energy trends, energy security issues in Asia, and delighted to have Jane up here on the platform instead of just down the hall in the next office. Next to me on my left is, oh, you have a first name that isn't Max. Shinichi Hori, Max Hori from Mitsui & Company. He's Senior Vice President for Mitsui & Company USA and General Manager of the Washington D.C. office where he arrived about 18 months ago, and I'm delighted that in addition to his great career at Mitsui, where he's mainly been in the steel-related business, so that's interesting as a consumer of energy. He is also spending a good bit of his time helping the Japan America Society as a trustee on our board, so we're delighted to have Hori-san do that and be up here. So thank you, Hori-san. And then to my right is my old friend, Jonathan Elkind. John is now Fellow and Senior Adjunct Research Scholar at the Center on Global Energy Policy at Columbia University. He was in the Obama administration in different roles, but he ultimately was the Assistant Secretary for International Affairs of the Department of Energy. I've known John for a lot longer than that as a consultant in this business, and we worked together a number of years ago on a variety of interesting projects. So delighted to have this great team up here. I wanna start by asking, and I'm gonna ask a few questions and then wanna open it up to you, so I'll be thinking about questions that you wanna ask the panel. But I wanted to start, before we get to the US-Japan dimension specifically, Jane, let me start with you to lay down some sort of broader landscape issues. So it was a few years ago that we all started reading about the shale gas revolution, and you probably have been reading about it for longer than that, but I think for the average person. And we all sort of learned that the US had this new capability and was becoming a producer of energy itself. The export ban on natural gas was lifted a few years ago, exporter as well. So that seems like a pretty big change. And so with a few years of hindsight, how has this disrupted or changed the energy markets in the Asia-Pacific broad matter? A pleasure to be here. So Matt, you're right. I mean, so this shale gas, we started hearing about it, reading about it a couple of years ago. And first it started on the gas side around 2008. We started having the commercial scale production of shale gas, unconventional gas, that helped turn the decline of domestic gas production within the US. And fast forward, we started exporting a shale US-based, shale-based liquid financial gas February of last year, 2017, and sort of made this debut, to this sort of a global LNG society, if you will, as one of the up and coming exporters. And on the oil side, I think there's a bit of a lag. It started from the shale gas side, but then quickly, the similar set of technologies was applied to the shale oil extraction side. And earlier this decade, we started seeing the domestic production of crude oil increase quite a bit, again helping the decline of the US domestic crude oil production and sort of allowed us to make a U-turn. In the 1970s, we were producing about 10 million barrels per day, and that steadily went down by about half, leading around the time that we started putting more focus on the shale oil, tight oil production in this country. And now, we are producing almost, I guess, nine million barrels per day. As Matt mentioned, the ban on the US-produced crude oil was lifted in December 2015. Now we're exporting crude oil. Again, the US is emerging as a major global oil gas, or oil side player. It was really interesting to host Fatih Biro of the IEA. He's the Executive Director of the International Energy Agency based in Paris at the CSIS yesterday. And one of the four things, I guess, upheavals, so upheavals in the global oil or global energy system, the current lead is the rise or the US turning into the undisputed global leader for oil and gas. I mean, that is quite a major statement from the head of agency that was established in the light of Arab oil embargoes in the 70s when we're very much concerned about the security of supply, what that may mean for the national security interests, but then geopolitics around the world. And I guess quickly, when it comes to what that may mean, I mean, the gas side, as Mr. Tudugi eloquently highlighted, it's a very good news. I think it's not just to Japan. I mean, in this context, we're very much focused on US Japan for a good reason, but it helps many other emerging economies around the world, but particularly Asia, that's where the demand growth is quite visible. And again, I don't think we can understate what it means for the US to become a global gas supplier, not just over the gas supplier, not so much because of the volume of the LNG that we'll be exporting. It's the type of changes that the US LNG exports are bringing to the market. It's the much more flexible terms in contracts, shorter. Certainly, you can sign a longer, multi-decade loan contract, but it's giving a lot of buyers ability to sign shorter ones, non-oil-linked ones, and also destination-flexible contracts. So it's really helping to diversify the pool of suppliers, but then also increasing the liquidity in the global gas market, and then thus helping increase energy security of Asia Pacific. Great, thanks. Well, again, lots of things to follow up on, and I will, but let me bring John into the conversation next and ask first of all, is there anything in that landscape that the Jane just laid out that you want to elaborate on or sort of add anything to sort of describe the landscape we're operating in now, but also then to talk about the policy framework because the Trump administration seems to have taken a fairly different approach to this set of issues and the energy features pretty prominently in the national security strategy where they talk about energy dominance, and there've been a number of priorities listed, reducing barriers, promoting exports, ensuring energy security, attaining universal energy access, and furthering America's technological edge. Actually, that stuff, mostly as those headlines, doesn't sound all that different. So what is different about the Trump approach to energy as opposed to the Obama approach generally? But first, if there's anything on the landscape that you want to add. Well, just as a point of emphasis on to augment what Jane, I think, very correctly said, it is hard to exaggerate the dramatic nature of the change that is going on right now in global natural gas markets. From an industry which primarily was characterized by point-to-point relationships from natural gas production fields delivered by pipe to specific off-takers, whether that was power plants, fertilizer plants, other industrial installations in the past and historically has been a substantially static and point-to-point relationship. Now, with the growth, the very dramatic growth of the LNG trade globally, we see ahead of us a world in which the predominant share of natural gas in trade will be in the form of liquefied natural gas, specifically in the last, I believe it is three to four years, there has been a 40% increase in the capacity for liquefaction of LNG that is changing it from gaseous state into super chilled liquid state. There is a projected further 60% in growth in LNG capacity that is projected between 2015 and 2020. So this is a, things don't move quickly in the energy business as a general rule, this is something that has moved incredibly quickly. So too demand has grown very significantly. It's worth calling out a few figures. In 2017, Chinese natural gas year-on-year demand was up 25%. LNG demand for China up 50% to 67 million tons, which is about 70, call it 72-ish billion cubic meters or something like 7 billion cubic feet per day to use the US measure, unit of measure. China has already surpassed Korea as the number two importer, excuse me, of LNG and is expected to surpass Japan in the course of this year. Likewise, growth in major Southeast Asian markets, growth in demand has also been dramatic. Between 2017 and 2025, for example, this is prospective, there is a projection from one of the analytical houses, Wood McKenzie, that one will see a 24 million metric ton per annum growth in demand. So I say all of this as a foot stomping exercise to emphasize the point that Jane made, which is dramatic change in natural gas markets worldwide in LNG markets and especially in those markets in East and Southeast Asia. Now, to the question that you posed, Matt, about changes in policy between the previous US administration and the current administration, this is one of these cases where one sees both an aspiration for what the current administration describes as significant dramatic change, but where candidly, I think it is worthwhile to take a closer look and to see what is rhetorical and what will be something real. The shale gas revolution was not an overnight phenomenon. The fruits of it started to be very visible during the Obama administration, but that was on the back of a couple of decades of research carried out both by industry, private entrepreneurs, but also with significant support, co-funding from the Department of Energy reaching back to the 1980s. So not an overnight revolution, but very significant. So if the US is now in a position to see itself as a major exporter of oil and gas, that is something that comes on the shoulders of work done by at least two, three administrations that proceeded. That doesn't mean there hasn't been any change and isn't going to be change. One very notable point has been this administration's, I would say, disdain for efforts and collaborations globally to reduce or avoid global climate change. And different people will have different views on that. I think that's a rather unfortunate and misplaced objective, but nonetheless, it is clear that that is an intention. A second element that is very much worth looking at is a deregulatory element. There has been a great deal of emphasis placed by this administration on removing what it characterizes as inappropriate barriers to economic activity. One can have a full, long conversation more time than we have today as to what constitutes unfair, undue regulation versus that which is sensible and appropriate. A third area that matters a lot for energy is policy from this administration with regard to trade. Now, it has been noted by many analysts that in the last US presidential campaign, the two major candidates, both were expressing some degree of skepticism about certain multilateral trade agreements that were under development. I think that in the administration, the Trump administration, since its arrival in office about one year ago, nearly today, has taken that rhetorical discussion about whether trade is good for the United States and has really gone very far with it in a way that creates major uncertainties around the globe as to the investment of the United States in global trade, something that had been a feature of US policy since World War II with administrations on both sides of the aisle. So there are many more items that I could point to as elements of change. I will just say that the scrutiny that I recommended when I first started talking about this topic goes to the idea that policy, whether policy is instituted by the current administration or the past administration that I worked for, changes in policy do not stop gravity from operating, right? Science still is in effect, markets are still in effect, technological developments are still relevant, and many of these latter features, I believe will translate into much less impact than some in the Trump administration would wish. I'm happy to elaborate more, sorry to go on so long. No, no, that's very helpful, thank you, and then there are follow-up things I wanna ask you about, let me bring Horizan in by asking about all of that against that landscape of changing markets, changing policy, you know, the Trump administration's deregulation efforts, its tax reform, changes on climate change, on trade, I mean, many different topics that affect a company like Metsui's decision investment in the United States. How does all of this affect energy and not in energy? Well, thank you very much. Basically, the current administration's policy, there was this deregulation policy, as well as the, especially in the energy field, as well as the tax reform, all of this are basically a follow-in for a company like Metsui's activity. Obviously we, for the past, let's say a decade or so, we have been heavily investing into the oil and gas sector, total, probably a little over $8 billion that we have invested in the past decades, which is a significant dollar amount. And of course, you know, helped by the increase of the demand in the Asian countries, as well as this shale revolution. Now, we're not going to, what I see at the moment, I said generally the US policy has been fairly positive factor for us, but what I see lately is that the investment activities in the US, especially in the energy sector, has somewhat, I would say, matured. And this is, probably there's a lot of factors and because of the sort of uncertainty of the future, especially the market, not only for the oil and gas, but also for the downstream products as well. So a little bit matured. We see a lot of Japanese companies or investors be a little hesitant in putting additional money into the energy sector because of this market situation or sort of uncertainty. Another thing is that we see an increase in costs in the construction side. And it is not only the construction material in general, including steel, for example, I'm basically a steel guy. And we see a lot of price increase or the market increase because of the trade policies from the administration. But not only that, we see difficulty in securing very skilled labor force, especially from foreign countries, including our project. A lot of the projects, especially in the energy side, rely on skilled foreign labor force. But, and I'm not really sure exactly if this is linked to the immigration policy of the Trump administration, but we see delays and visa issuance. And also, this is going to be for the future if the deportation of undocumented immigrants are going to be accelerated in the future. Obviously, that is going to heavily impact the cost, especially on the construction side because obviously those people are a lot of, many of the percentage are working, not only in the agricultural industry but also in the construction industry as well. See those kind of a little bit of a change in the environment, so to speak. Actually, I think we're gonna have to have a couple of other sessions on some of the topics you talked about, including steel, trade, and visas, and lots of other interesting topics. But let me ask about, Jane, to take it back to US-Japan cooperation. Tsurugi-san mentioned a variety of opportunities, areas for opportunity for US-Japan cooperation and energy. Can you, in your own words, talk about what the biggest opportunities are and also what the biggest obstacles are? What are the challenges? I mean, so I think, I mean, there are a few. I guess both you and John mentioned nuclear, advanced nuclear technology is something that labs and S&T communities from both countries have been closely engaged with over the past couple of decades. But I guess in the context of to sort of have a little bit of a leeway to the challenge side of the conversation, I think LNG is where there is a very exciting opportunity. And in particular, I wanted to highlight how the current administrations focus on trade deficit reduction has been giving a bit of anxiety to a lot of policy makers in different capitals, but including Tokyo, I would say. And when it comes to energy, LNG is something that Japan has great need, especially in light of the uncertainty over the nuclear restart, not just the timing, but the scope. Whether Japan can hit this 2030 power generation mix, I guess about 26% coming from LNG. And I thought it was brilliant that the Japanese government came up with this $10 billion US dollar or one trillion Japanese yen sort of a package to really cultivate the capacity in Southeast Asia, in South Asia. And I think Africa was also included because I think the bilateral relationship, the energy, the role and strengthening the economic relationship is important. But I think we're at the point where it has to be a lot more multilateral. And as Japan faces this uncertainty, quite frankly, I don't think anyone from Japanese side wants to be stuck with the volume that they wouldn't be able to consume. And but then at the same time, being very sensitive to this administration's concern to improve the trade deficit. And it may not be a direct way, but by having this LNG capacity building initiative, trying to help the certainly Japanese companies by going into third markets, using their skills and to come up with say LNG, receiving terminals, et cetera. But then also by so doing help US LNG go to these emerging markets. I mean, these markets are quite small today, but there's potential. And so I think that's a very interesting way of addressing both the political sort of opportunity or sees in the political opportunity that there's a strong emphasis from this administration trade. But then there is still strong need for natural gas from Japanese side. Yet they do want to have the flexibility and by engaging other countries in the region or in the mobile emerging economies, they're being able to have this longer term sort of a game plan where they can really try to have much more mature LNG market and be able to, I guess, be a player. That's not just as a consumer, but as a trader, as sort of facilitator of the, and even on the climate side, the transition helping these economies to become a lot more of a low carbon in the societies. But I guess the challenge side is, I think there is a concern, I would think, among some of the folks that the notion of Asia premium, that a lot of Asian economies, particularly Japan and perhaps Korea, have long paid much higher price for LNG for the supply security from traditional supply, by exporters like, say, Qatar or Russia, perhaps. And I think there is bit of a concern whether that will just be, so they're welcoming the US coming into the scene, making the LNG market a lot more competitive and transparent, but I think there may be a little bit of concern that maybe this Asia premium I think it's just be replaced by this alliance premium. To that extent, I think from the US side, I think it's important to be sensitive to that sort of concern and also this, the message of energy dominance. What does it mean? At the end of the day, we do not have a national oil company that can go in or that Washington can say, okay, you go supply X volume shortage if Japan stays away from investing in XYZ energy supplier countries that are now on our good guys list. So it's not more, I think it's a much more complex world and there are a lot of nuances as the two governments and two business sectors try to make it mutually beneficial energy relationship. Well, I think that there's a point that I think is important to focus on if one looks at the energy economies of the United States and Japan, which is that these are two countries that are deeply invested for now decades in the notion of the benefits of a diversified energy supply. Now, obviously our natural endowments between the two countries are quite different from one another but there is a strong sensibility that I think is shared among Japanese energy leaders and thinkers that I have spoken with and certainly those that you would find in the United States that it is a good thing not to have all of one's eggs in one basket. So yes, in Japan and the United States there is at least in the energy circles, a sense that safe and secure nuclear power, it needs to be a part of the mix going forward. It certainly will be, I would expect, in the United States. That is something that led us during the previous administration and certainly it seems to be continuing much to my satisfaction in the current administration to be an area of focus, figuring out not only the decommissioning challenges that Surugi-san spoke about but also next generation issues. Japan's enormous achievements in energy productivity are an area where the United States has a huge amount to gain from looking with care at those lessons whether one is talking about industrial energy efficiency or other sectors but in general the commitment and the investment both figurative and literal investment in next generation energy technologies. That's another feature that I think is another trailing wind if I might use Hori-san's image. Whether one is talking about high performance materials for application in energy technologies, whether one is talking about specific technologies such as battery storage with new battery chemistries, whether one is talking about methane hydrates and over the horizon resource that is not economic today but who knows what it may be tomorrow. There's a huge scope for additional collaborations in the research communities, in government to government channels and between companies. I remember former Ambassador Fujisaki here used to carry around a piece of paper with a bunch of charts about U.S.-Japan economic relations and each economy and he had one of his charts was about the energy efficiency point that Han produces one dollar of GDP with one dollar of energy where most countries it's nine or China was nine I think or something. So it's very energy efficient and some technologies and so forth are I think an opportunity for collaboration. So Hori-san so the two sides the last November as Tsurugi-san mentioned Trump was in, launched a new, from a business perspective, what does that mean? What are the opportunities they're provided? Est the trade or is it? Right, thank you. Let me give you two, two, let's say two examples of the activities or the business that Mitsui is doing which may fall into this U.S.-Japan energy partnership in a broader sense. One is a, and by the way the two examples are both Japanese company which is Mitsui and a U.S. company working together in a third country in order to develop and contribute to the growth of the community or the country or the area. The first example is Mitsui and also a large energy company which is called AES and headquartered in, you know, where's that? Allington, Virginia. And we have, this is actually the third project that we have been promoting with the AES and lately we have announced a joint venture agreement with the company to make an investment in the country of Jordan for solar power generation. That's gonna be the third joint venture in the country of Jordan together with AES. And obviously that is, it's a power generation so it's a little bit, it's not like oil and gas but in a broader sense I would think that that would also fall into the kind of energy partnership. Another thing, another example is Mitsui together with a U.S. company, energy company which is called Anadarko, been together with three other Indian companies, you know, developing an LNG plant in Eastern Africa which is Mozambique. So that is also, I believe it's a good example so of two of our countries or companies working in an area that needs development and needs support working together. The U.S. Japan thing is not really a bilateral thing, it's not just simply export import. Those kind of good examples, I think as a private sector, as a company like us, we would like to develop it. And by the way, these two examples are of course, it was not promoted because of this U.S. Japan energy partnership. We have started to do that many, many years ago but just to give you an idea of what we are doing. So I'm conscious of the time and want to bring the audience in for a few questions but let me just ask one final thing to all the panelists. Actually, questions but let me just ask about China. So China has been mentioned a couple of times in this conversation largely as a consumer and that's, so I'm including China as a consumer in this question which is what is China, what is the impact of China on markets and on U.S. Japan energy relations but not only as a consumer but also they're now an exporter of nuclear power. And then I think this is related but we're spending a lot of time following China's Belt and Road Initiative and some of that touches on energy infrastructure issues and I wondered with all of those things and maybe others, how does China factor into U.S. Japan? Well China is obviously the elephant in the room. It, the scale and the speed of its demand growth is very notable. China is first in almost everything in the energy sector at this point whether one is talking about coal where it represents 50% of global demand, oil imports, et cetera. You can just go kind of down the litany, number of reactor builds that are underway, et cetera. So in terms of the demand picture, China is obviously a very significant and rapidly changing, rapidly growing part of the total picture. On the supply side, China has not moved as quickly and here I think you see some of the effects of the decision-making structure and the economic structure in China where some of the aspirations, for example, that China has had to increase its natural gas production have consistently underperformed in part because the terms were insufficiently attractive to date to see the development of the supply chain that you need in order to, for example, develop shale gas resources. The pricing policy was not conducive. China has demonstrated an ability to change its policies over time and so that will be interesting to see whether that does change. Clearly China does not share the fundamental emphasis that both United States and Japan have placed on markets as being the driving element of good energy policy. That's not to say that the United States and Japan have looked at what constitutes a good energy market in an identical cookie-cutter way. That certainly isn't true. But the kinds of collaborations, for example, that we have had with Japan in the International Energy Agency for more than 40 years between many of our companies, I think the first sales purchase agreement for the provision of US-sourced LNG, namely from Alaska to Japan, was signed in, guess the year, 1967. So there are lots of long, deep routes between the United States and Japan and it's a slightly different point of departure. I'll stop there. I may, sure. Just quickly, I think you and John already covered all these really important topics, the themes within this tri-lateral perhaps relationship. I guess in certain energy sectors, I think China is a partner to US and Japan. Upstream investment could be one, but then also in the third party, third market. Also nuclear, we have quite a bit of an interaction with Chinese labs, national labs. I think Japan also has a lot of relationship and show in energy conservation that's something that Japan and China have been collaborating on for many decades. But then there is also a competitive element, like solar case that's before the White House is one prime example now. But I think at the end of the day, I think China needs to be a partner as we try to have global energy governance system that is sustainable, predictable and in many ways, I guess hopefully much more rule-based, transparency, competitiveness, all these things need to be reflected if we want to have open energy system. And for that reason, I think I'd like to stress how whether some may like it or not, I think China needs to be brought in a lot more actively. And so far, I think institutions like IA are doing a very good job, but I think there's still a couple, a lot to be worked on. OECD, it's an OECD based entity, right? Okay, well there's again lots more to talk about up here, but I wanna give folks a chance. I'm gonna take a group of questions and then let all the panelists go down and answer whatever parts of those questions they want to. So if you have a question, raise your hand and I think we have microphones way in the back. Oh yes, thank you. My name is Steve Miller, noting that most US LNG exports will go by ship. There have been calls to require those exports to go on shifts built in the US and crewed by US mariners. And I'd just be curious to get the panel's reaction. Thank you. From a technical point of view, you've talked a little bit about markets, but I'm wondering about changes in the technology landscape that might affect this. One particular one would be in automobiles with the hybrids and electric vehicles coming along. Does that really change the demand picture dramatically, particularly in Earth's world countries? I have a question for Hore-san. Could you comment more on the impact on potential Japanese investors, including your company, but more general on what would be the impact of our US withdrawal from NAFTA on Japanese attitudes toward investing in energy and other sectors in the United States? First of all, the question for Mr. Miller in the back there about US ships and mariners for LNG exports. This would be a Jones Act on steroids. For those of you who aren't familiar with it, the Jones Act requires the use of US manufactured ships and mariners to move energy from one place in the United States to another place in the United States. It is a hugely market distorting piece of legislation that is anachronistic and frankly is bad policy. And I'm sorry to say that, but it is my strong view. If we were to do that for international, for exports of LNG, that would be one of the clearest cases ever of shooting oneself in the foot. Already we had this highly unusual situation a couple of weeks ago where a tanker of LNG was imported to Boston from, basically from the Yamal project in Arctic Russia. Why would you import LNG into the United States from Russia when you have lots of LNG that Sheneer is happy to sell you from the existing Sabine Pass project because it's more expensive to move it on a US vessel. The technology landscape, EVs, other forms of transportation related change are expected to have an impact, but this is a very, very difficult question. We have a big project going on at the Center on Global Energy Policy about peak oil demand with the emphasis being on how one engages in analytically valid projection of when you could see changes happening. It's awfully hard to foresee big inflection points in technology and how quickly they come into effect and with how great of impacts. Let me stress though that if you look at current demand for crude oil and refined products, light duty vehicles, passenger vehicles, represent roughly a quarter of total demand. Even if you do not see, even if you see a major drop off in passenger vehicle demand, heavy duty vehicles, maritime, aviation, and especially in industrial feedstock usages of crude oil would not be disappearing overnight. So you might have a shifting of the market, shifting of the prices that might in fact incent more usage in some of the other demand categories. Just to quickly to what John said, I think he already covered Jones Act portion, but the role of EV as John indicated, I think there are multiple views as to the scale of the impact on oil demand, but again, in the transportation sector, there are so many like the maritime, heavy duty, et cetera, but I think the bigger, the other way to look at is how the electrification is this big trend. So EV is part of that story, and I think we are still, we still have quite a bit to, I guess, think and analyze to better appreciate exactly what sort of an impact that may have on greenhouse gas emissions reduction effort, for example. You know, it really depends whether you're burning coal to come up with a fleet of EV, or is it natural gas, is it what goes into the system. I think the idea of EV is something that's exciting, but I think we need to really pay a lot more attention to the details to better appreciate the impact on oil demand, but then also on the climate. Kim, that's a very difficult question. I would like to ask you what would be the impact. We are, as a company, we are still kind of in the middle of analyzing really, because the current climate is a little bit toward, maybe there is a withdrawal from NAFTA, but so we have to kind of be prepared. What I can say is that the kind of, the appetite to invest additional into, and this really depends on the industry or the sector, but has kind of a slowdown, I would say, and this is because of this uncertainty and we don't know what's gonna happen. So, but in the meantime, I would also think that the withdrawal from NAFTA itself, you know, US is going to eventually become really impacted a lot, so I really can't make a straight answer to your question, but obviously the kind of, how would I say, the climate is getting, you know, not that great, especially to the, in general, as to the investment kind of attitude into the United. Okay, thanks. Well, I'm sorry that we ran out of time and I think we've left you with about 90 seconds worth of break before we start again at two, but maybe we can buy ourselves a few minutes of additional break and be a little catch up in the next round, but please join me in thanking the panelists for a terrific discussion. And thank you all. Please come here. Thank you guys. Indeed, thank you very much, Matt, and to the panel, great contributions to our discussion today. Sudheer Gisan, thank you so much for your presentation. You gave us a lot to think about in many different areas of energy and I'd like to pick up on some of those themes going forward and then some of our research. So a terrific contribution today. We will convene our international panel in about 10 minutes is where we'll start. So we'll try to start, well, a little bit before 2.10. Thank you.