updated 4/13/2005 1:07:57 AM ET 2005-04-13T05:07:57

Japan will allow gas companies to test drill in a disputed area of the East China Sea, officials said Wednesday, a move that would likely worsen a diplomatic row with China.

Japan will start reviewing applications later Wednesday from companies that want to explore deep-sea natural gas fields in the water, trade and foreign ministry officials said.

Both Japan and China claim the gas deposits to power their huge economies.

Tokyo’s announcement comes as relations between the two Asian heavyweights plunge to a new low after violent anti-Japanese protests broke out in several Chinese cities over the weekend, sparked by Japan’s approval of a history textbook that critics say plays down Japanese wartime atrocities.

But Prime Minister Junichiro Koizumi denied Wednesday’s decision had anything to do with China’s handling of the protests or its refusal so far to apologize. Protesters had smashed windows at the Japanese embassy in Beijing and attacked Japanese businesses.

Meanwhile, the dispute over the gas fields has intensified in recent months.

Japan has repeatedly protested Chinese exploration of the fields, saying the activities extend into Tokyo’s exclusive economic zone. But Beijing says its surveys are within its zone and has refused to halt them or share results.

Earlier this month, a Japanese geological survey showed that the gas fields being explored by China likely extend into Japanese territorial waters.

Trade Minister Shoichi Nakagawa, who called China a “scary country” on Tuesday, warned last week that Tokyo would push ahead with its plans to let Japanese companies begin test-drilling near an offshore Chinese drilling platform in early April.

Several Japanese companies have applied to explore the gas fields since the 1960s, but Tokyo has delayed approving them because it didn’t want to aggravate the dispute.

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