Japan and China failed to resolve a row over gas exploration in the East China Sea in talks that ended Saturday, but agreed to more dialogue this month to discuss Tokyo's new offer for joint development, Japanese officials said.
The row over China's development of gas fields in the sea dividing the two countries - and near waters over which Japan claims exclusive economic rights - is one of several issues that have strained ties between the Asian neighbours.
Tensions rose in September after Japan said China had sent warships to the area and started producing oil or gas at one of the fields.
Japan reiterated its demand that China cease its development work in the area and provide geological data, and also presented a new proposal for resolving the dispute that includes the idea of joint development, Japanese officials said.
"The Chinese side said they would consider it earnestly and would unveil their stance at the next round of talks in Beijing," Kenichiro Sasae, director-general of the Asian and Oceanian affairs bureau at Japan's Foreign Ministry, told reporters. But the Chinese side showed no immediate sign of agreeing to Tokyo's demands, another official said. The next round of talks will take place later this month.
"The Chinese side reiterated that China's resource development is taking place in undisputed waters near China," the second Japanese official told reporters.
China may consider providing related data to Japan after reaching an in-principle agreement on joint development, the official said.
Tokyo's offer, a counter-proposal to a joint development plan raised by Beijing in earlier negotiations, demands that China stop its ongoing work, a third Japanese official said.
Japanese officials expressed concern over the fact that China was moving ahead with development, and explained that there were "strong views" within Japan calling for its own test- drilling in the area if China continues its development without heeding Japan's demands, the second official said.
This triggered opposition from the Chinese side, the official said, adding that there was some "harsh give and take" between the two sides.
Japan also took up China's naval activity in the area. China replied by saying that such vessels were conducting normal training activities and countered by accusing Japanese ships and aircraft of interfering with the work of China's development work in the area, the second Japanese official said.
Japan fears that Beijing's development of gas fields located near what Japan claims is the median line that separates the two countries' exclusive economic zones could tap into resources lying beneath the waters over which Japan claims rights.
China does not recognise the midway line and says its exclusive economic zone - which gives a country sole rights to resources such as mineral extraction from the seabed - includes areas on the east, or Japanese side, of it.
The Sasae said that Japan's new proposal calls for joint development that spans both sides of the midway line.
Energy experts have said that natural gas reserves in the area, estimated as high as 200 billion cubic metres could be hard to extract and are located in a spot ill-suited for sale to the huge Japanese market.