JPRS ID: 9940 JAPAN REPORT

• Document Type: CREST
• Collection: JPRS
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000400040052-6
• Release Decision: RIF
• Original Classification: U
• Document Page Count: 48
• Document Creation Date: November 1, 2016
• Sequence Number: 52
• Content Type: REPORTS

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICIAL USE ONLY
JPRS L/9940
26 Aug~st 1981
Jc~ an Re ort
p p
- (FOUO 51 /81)
FBIS FOREIGN BROA~DCAST INFORMATION SERVICE
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
NOTE .
JPRS publicatior~s contain information primarily from foreign ,
= newspapers, periodicals and books, but also from news agency
~ transmissions and broadcasts. Materials from foreign-language
sources are translated; those from English-language sources
are transcribed or reprinted, with the original phrasing and
other characteristics retained.
Headlines, editorial report~, and material enclosed in brackets
are supplied by JPRS. Processing indicators such as [Text]
or [Excerpt] in the first line of each item, or following the
last line of a brief, indicate how the original information was
processed. Where no processing indicator is given, the infor-
mation was summarized or extracted.
Unfamiliar names rendered phonetically or transliterated are
~ enclosed in parentheses. Words or names preceded by a ques-
tion mark and enclosed in parentheses were not clear in the
original but have been supplied as appropriate in context.
- Other unattributed parenthetical notes within the body of an
item originate with the source. Times within items are as
given by source.
The contents of this publication in no way represent the poli-
cies, views or at.titudes of the U.S. Government. ~
COPYRIGHT LAWS AND REGULATIONS GOVERNING OWNERSHIP OF
MATERIALS REPRODUCED HEREIN REQUIRE THAT DISSEMINATION
OF THIS PUBLICATION BE RESTRICTED FOR OFFICIAL USE ODiLY.
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02109: CIA-RDP82-00850R000400040052-6
~OR OFFICIAL USE ONLY
JPRS L/9940
26 August 1981
JAPAN REPORT
(FOUO 51/81)
CONTENTS
SCIENCE AND TECHNOLOGY
Researchers Discuss Status of Biotechnological Rese arch
~USHIO, Apr 81) 1
Future Energy Saving Strategy of Private Induetry Described
(NIKKEI BUSINESS, 15 Jun 81) 31
- a - [III - ASIA - 111 FOUO]
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00854R004400040052-6
FOR OFFIC'IAL USI: ONLY
,
SCIENCE & TECHNOLOGY
RESEARCHERS DISCUSS STATUS OF BIOTECHNOLOGICAL RESEARCH
~ Tokyo USHIO in Japanese No 263, Apr 81 pp 86-112
[Articles by editorial staff based on conversations with respective researchers at
Japan's ma~or academic institutPS] '
~ [Text] 1. Tsukuba University, Biological Sciences (Harumi Oshima, ~ssistant
professor)
What Regulates the Development and Cellular:~Differentiation of Higher Organisms?
We are trying to elucidate the genetic structure and expression of higher organisms
at the molecular level. Currently, we are using murine genes in the experiments
and conducting research using a technique to manipulate the genes.
The genes we deal with naturally contain RNA's (adenine, guanine, cytosine, and
uracil as the bases), but in addition, we are interested in lower molecular weight
RNA's which are scattered in the nucleus--they are called snRNA's.
It has been speculated that there are approxima.telq 100 such snRNA's in the nucleus
of eukaryotic cells including mammals, and that they are not concentrated in one
area, but scattered in various sites on the chromosomes.
So far, about 10 kinds of snRATA's are known to exist, and their structures are also
being elucidated, little by little. Recently, it has been revealed that a certain
type of snRNA seems to have a function to ligate RNA genes (this is called splic-
ing).
It is said tha.t genes (DNA) of higher animals are positioned so that the exons,
which are required to transfer genetic information, and the parts noi: required
(intervening sequences) are alternated. These intervening sequences became
separated, and finally only exons that transfer genetic information are ~oined,
making mRNA (messenger RNA). It appears that the snRNA is involved in the splicing
of this ligation function.
This snRNA is present in all higher animals, and its sequence is similar even
though the organisms are d iff erent. Theref ore, its function is believed to be
very important, and attempts are being made to elucidate its structure and function.
1
F~OR OFFICIAL USE Ot+ILY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
The snRNA is also used as a hook to catch a fish called RNA, and the structure and
function of RNA are being studied.
Specif ically, the snRNA's of mice are extracted, and using them as hooks (detection
tools), genes are excised from murine DNA and attempts are made to elucidate their
- structure and runction.
The mRNA's are made from genes and they make proteins. In that process, the snRNA
i~ believed to have a control function. Thus, clarif ication of this point is
another goal of this study. We may say that it is a big pYOblem leading to under-
standing of human and animal developnent and the control mecha.nism tor cellular
differentiation at the same time.
~ We are conducting research with the objective of clarifying the control mect~anism
of this differentiation and development.
Regarding the future, what I am interested in is to elucidate the development,
cellular diff erentiation process and mechanism of higher organisms, including man,
at the genetic level. I am also interested in medical sub3ects and I would like
to study cancer. Specifically, I would like to study what kind of genes become
mutants in the case of cancer in which a virus is not involved, and what kind of
genes are expressed to cause cancer. Then, I would also like to work with gene
therapy of genetic diseases which are congenital metaboli~: anomalies.
5ince humans cannot be easily used, I would like tc+ ~.onduct model experiments using
animals which can be applied to humans in the future.
In particular, gene therapy for genetic diseases has been a dream of mine since
youth, and I would like to specialize in this area if possible.
Speaking of cancer cells, many investigators agree that changes occur at the
genetic level, and if that is the case, there is great significance in studying
the genes. And I have no doubt that the technYquea of genetic manipulation will
demonstrate their great power there.
Even if the cause of cancer is not known, if prevention and treatment are possible,
we are that much better off. In the question of treatment, we have interf eron, but
I believ~ that the use of antibodies that specifically react with cancer cells ie
also promising. Tectuiiques of genetic manipulation are also useful in these areas.
The regulations for genetic manipulation are very strict in Japan; the relaxation
of at least one level is likely to take place in the near future, and this is
naturally strongly desired by the researchers. The present regulations, I believe,
are too strict from an ob~ective point of view. For example, in the stipulation
allowing the use of viruses and pathogenic bacteria, everything is left to the
good 3udgment of the researcher, flowever, it is virtually impossible to use viruses
in recombinant DNA research to prolif erate them by means of genetic manipulation.
The risk is in the viru~es themselves, to begin with. Therefore, when we are
allowed to cultivate them directly, it is a sham, viewed ob~ectively, that their
recombination is strictly regulated. Naturally, a certain degree of regulation is .
necessary since there is a latent risk in genetic manipulation as well.
2
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-04850R000400040052-6
FOR OFFICIAL USE ONLY
The natural sciences in Japan so far have been oriented mainly toward chemistry
and physics. With the advances made in genetic manipulation, the importance of
biology will be incorporated into this pattern to a considerable degree. And I
believe that the industries based on biology will increa.se. In other words, I
believe that biology will come to be emphasized as the basis of natural sciences
and industries, as in the case of the United States, where such a trend exists.
2. National Institute of Health (Masanori Okanishi, chief, Genetic Biochemistry
Section, Department of Antibiotics
Mass Production of Antibiotics
Our research is slightly diff erent from genetic manipulation. Sowever, it has
three main goals in the sense of social responsibility. One of them concerns the
mechanism by which antibiotics are produced. We would like to clarify this
mechanism genetically and biochemically.
Another goa.l is how to increase the productivity of antibiotics. Then, when the
mecha.nism to produce various antib~.otics and the mechanism to increase their pro-
duction are lmown, the next stage is to.create new antibiotics. This is our third
goal.
To that end, various genetic and biochemical studies are necessary, and that is
what we are doing. In recent years, techniques in genetic manipulation have made
considerable prog ress, and those techniques are very useful in our research. In
particular, we would like to introduce them in the study of Actinomyces.
.
The majority of bacteria that produce antibiotics are of the genus Actinomyces.
We ha.ve worked for about 5 years trying to introduce genetic manipulation tech~
niques in the process.
In fact, most of the various techniques established using E. coli are not usable.
Even for the ones that are usable, a drastic modif ication is necessary. Conse-
- quently, we have poured most of our efforts into the ~tudy of Actinomyces, their
� modificatiun and discovery of new theories.
Finally, we have completed all the techniques necessary to do the work. We plan to
present a paper on this subject for the f irst time at ��he upcaming meeting of the
Society of Agricultural Chemistry (in Kyoto, 30 March-2 April).
. More specif ically, there is the so-called host-vector system. The vector may be
thought of as a"carrier" to transport DNA. A certain DNA is placed on a special
vector of plasmid DNA and inserted into the host Actinomyces. The principle is
just that. However, there was the problem of compatibility with the host
Actinomyces. For example, among the numerous problems were whether DNA could be
integrated or rejected, and whether or not a recambinant DNA once spliced could be
easily excised once more. These problems have all been solved by our recent
~ studies.
Another important point in the sociological sense is whether or not the hosts are
saf e. Therefore, they have all been checked using mice, rats, monkeys, etc.
3
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
I believe that the work carried out thus far is ~~robably the first of its kind in
Japan. .
By establishing this method, the increased productivity of antibiotics can be
implemente~i theoretically as well as by design. We would like to undertake this
work first.
The conventional method used f or upgrading antibiotic production has been to treat ~
bacteria with all kinds of mutagens. For example, bacteria were irradiated with
x-rays, ultraviolet rays or cobalt-60, and the surviving bacteria were measured
individually for increased productivity of antibiotics. However, in actuality, it ~
required an enormous amount of time and labor as well as chance. There was no
theoretical basis whatsoever; the ob~ective was only to select bacteria tha.t showed
increased productivity after being treated with a mutagen. Moreover, bacteria
that showed hig'her productivity appeared in about one strain out of several
thousand examined. Then, a further increase in productivity was attempted by
further mutation of that one strain. Thus, there was no scientif ic basis or de-
sign.
Consequently, our ob~ective was to establish a method enabling production as fast
as possible with the least amount of labor in order to increase productivity a
little more theoretically by using a genetic manipulation technique.
But what in the world can we expect by using recombinant DNA technology? The
extraction of interferon or insulin is one thing, but there is a more funda~ental,
important role in this.
First, for example, when a certain DNA is spliced into E. coli, the qua.ntity of
tha.t gene in E. coli increases tremendously regardless of whether that genetic
code is expressed in the E. coli or not. In other words, it enables us to col-
lect a specific gene in large quantity. This is very useful in studying the
, genetic structure. This has great significance academically rather than in a prac-
tical sense.
Second, the mechanism of protein synthesis is entirely different in higher animals
and plants from that of bacteria, and that difference can be care�ully studied:
In extreme simplification, the biotic co~unity can be divided into prokaryotes
(bacteria group) and eukaryotes (organisms higher than fungi). The mechanism for
manufacturing protein from DNA is totally different in these two groups. And, that
diff erence can be studied. In other words, the mode of genetic expression can be
studied by inserting eukaryotic, that is higher animal or pl.ant, genes into a
prokaryotic cell called E. coli.
Third, there are many studies especially in the field of inedicine that are at a
stalemate, and the use of genetic manipulation techniques can open a way out of
that stalemate. An example is the pathogenicity of the tubercle bacillus. Why
does a certain bacterium cause the disease called tuberculosis? What sort of genes
are involved in what way in .the proceas? Such questions w311 be answered.
4
~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USH: ONLY
Next, at the molecular level, nothing of cell division was known regarding its
mechanism and the processes it goes through. However, this has been gradually
elucidated with the above method.
How are these prablems which have been scientifically elucidated being applied in
practical terms? Roughly, two things can be said. First,the productivicy o~
enzymes, hormones, and proteins can be increased. Another is to use genetic
manipulation for mQtabolic products such as antibiotics. Our research concerns
the latter.
What one must keep in mind in advancing such research is how to put a stop to the
hazards that accompany genetic manipulation. There are two wa.ys. One is to use
_ safe bacteria. This is so-called "biological containment." Another way is
"physical containment" that restricts the facilities in which such experiments ma.y
be conducted. We are working by setting up these two regulatory means.
~ 3. Fermentation Research Institute of MITI (Akira Uebayashi, head, Department
of Applied Microbiology, Fermentation Research Institute, Agency for Industrial
5cience and Technology)
Treatment of Environmental pollution Using Microorganisms
The ability of microorganisms to decompc~se environmental pollutants is neither
ubiquitous nor sufficient. The enzyme involved in the decomposition of Pnviron-
mental pollutants is said to be dependent on plasmids. In our research, we plan
to study the microbial adaptation to chemical substances in the environment and
their evolution from the microbiological and genetic aspects and to develap micro-
organisms at a genetic level that are use�ul in cleaning the environment.
Currently, we are studying bacteria that decompose mercury compounds, PCB
(polychlorinated biphenyls), etc, with rPSpect to the relationship between their
ability to act and the plasmid.
Synthetic chemical substances include some harmful ones. Unlike natural substances,
synthetic compounds cannot normally be decomposed by microorganisms. Theref ore,
our f irst attempt was to look for microorganisms that decompose mercury compounds
that are used in bactericides, etc.
Mercury compounds include various campounds such as mercuric chloride and phenyl ~
mercuric acetate, to which certain microorganisms are resistant, and they are not
easily killed. The microorgani~ms are cal_led Pseudomonas and are present in the
soil, etc. Compared to ordinary E. coli, they are 2,000-3,000 times stronger.
_ We studied why they are so strong. It was found in the course of the research that
the microorganisms have the ability to change mercuric chloride, if that is the
substance present, to metallic mercury. Unlike ions, metallic mercuries are rela-
- tively harmless among the natural mercuries.
In the case of phenyl mercury acetate, this organism was found to decompose it into
metallic mercury and benzene.
5
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICIAL USE ONLY
As these actions were revealed, we looked next for various enzymes in the micro-
organisms cultivated in the presence of a mercury compound. And two enzymes were
found. One is the enzyme S that cuts the bond between the mercury and carbon
atoms of the mercury compound. The other is the enzyme P'A~SR that converts the above
mercury to metallic mercury.
Speaking in greater detail, mercury campounds are bondei to an SH compound, and the
enzyme S cuts the carbon and mercury at that bond point. In other words, the
f ollowing mechanism has been completely proven--the mercury which was forming the
SH group receives an electron fram a glucose reaction, reductively releasing the
bond and separating carbon and mercury.
Then we sought answers to questions such as in what form the information of these
decamposer enzymes are present in the cells. For example, it was previously prwen
that circular, double-stranded nucleic acid DNA, that is, plasmids, are present in
the cytoplasm outside of the nucleus of a cell. Do such plasmids also exist in
this bacteria? And is the inf ormation for decamposition carried in the plasmids?
Four plasmids were found. We are now studying in what f orm the genetic information
of the enzymes that decompose mercury campounds is placed.
Therefore, we have not yet used the manipulation technique of splicing genes in
this research.
In the future, we will probably go into genetic manipulation at the stage when the
whereabouts of the genetic codes on the plasmids is proven.
, In add ition, we have finally f ound one or two plasmids related to PCB decomposition.
There is still quite a distance to go for specific solution to environmental pol-
lution. As an actual problem, we cannot use anything except what is stipulated in
tlie present experimental guidelines as host-vector systems. The production of
peptide hormones and proteins has recently been in the limelight. These studies
are an extension of the present work and will probably develop relatively fast.
However, the research we are conducting requires the multiplicatiion of various
kinds of enzymes, which I believe will be a development in the next stage.
Only recently, a microorganism that decamposes petroleum was discwered in the
United States, and it caused a patent dispute. However, although the microorganism
has the ability to decompose part of the petroleum molecule, it does not have the
ability to decompose the entire complex structure.
As is evident from such news, there are many ongoing studies in the world. However,
our research is unique in the material itself, and in that sense I believe that we
can make it grow as the only research of its kind in the world.
There are many voices pointing out the risks involved in the manipulation of genes.
However, it is the opinion of scientists, particularly in the United States, that
the risks are not that great. Take a pathogenic bacterium as an example: there
_ may be a hazard in the stage of handling it, but the hazards of the products do
not increase as a result of gene splicing.
6
. ,
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00854R004400040052-6
FOR OF'FICIAL USE ONLY
In addition, a splicing experiment merely involves adding a different gene, and it
is rare that it leads directly to the birth of a new viable organism.
The only host vector systems geared for industrial production are E. coli and yeast
for now, and if the microorganisms that are currently being used in industrial
production can be used as hosts, research will make more progress. In that sense,
many topics still remain for basic studies aimed at industrialization.
If I may add one more thing: recently, the term "biotechnology" has come into use.
~ This word is translated as "bioengin~ering technology." This is because the
fermentation industry includes products which are used as human hormones, and the
importance of bioengineering in the natural sciences is expected to increase in
the future. The term is sometimes translated as "life engineering," but it is
easily confused with "lif~ science" a;~d I think this is not an appropriate trans-
lation. In this field of biotechnology, the techniques of genetic manipulation
will probably continue to make great contributions.
4. Tokyo University, Applied Microbiology Research Center (Hyuga Saito, PrQf essor)
Multipurpose Application Using Bacillus Subtilis
Only one kind of protein can be synthesized by one genetic code. Interf eron,
insulin, growth hormone, etc, are all one type of protein and are theoretically
producible by inserting one genetic code. The application of current genetic
manipulation involves the production of the primary products.
In the United States, it began in 1972, and the cammercialization of insulin,
etc, ha.s been practiced for about 2 years. The products are all made by using
E. coli. In addition, attempts are being made to use Saccharomyces cerevisiae
(a type of yeast), a single-cell organism slightly higher than E. coli but practi-
cal application has not been accomplished as yet.
I have been studying Bacillus subtilis for 20-odd years. The DNA of B. subtili.s
is removed and inserted into another B. subtilis. Then the nature of the DNA
changes. This phenomenon is called transformation, and it was discovered in 1958.
At tha.t time, I immediate~_y thought of the genetic manipulation of B. subtilis
using B. subtilis. Such a movement also existed in the United Scates. However,
E, coli was in the mainstream at that time, and B. subtilis was not noted with
interest. E. coli has been repeatedly modified by many investigators since 1972.
On the other hand, we began work with B. subtilis several years ago. Although
there was a delay of 4-5 years compared to E. coli research, we were interested in
the numerous bacteriophages (viruses that proliferate using bacteria as hosts) of
B, subtilis, which we planned to use. In the case of E. coli research in the
United States, a bacteriophage called lambda is also being used, but plasmids are
much more well known. In general, people understand genetic manipulation to mean
the insertion of genes by joining them to plasmids. Genetic manipulation using
phages is ~ new methud, but the work is going very well.
Plasmids were also found in B. subtilis. However, bacteriopha.ges have more advan-
tages than plasmids.
_ 7
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
For ane thiug, they are stable. Plasmids are foreign substances to begin with and
disappear fast. But phages are ver~ stable. Furthermore, they pop out when in-
duced by ultraviolet irradiation, at which time they can be taken out.
When this technique 3s appl3,ed, in principla, an amylase gene or interferon gene
can be insertEd and taken out after propagation. flowever, in practice it is not
quite that simple. In order to have them make proteins from DNA, the elucidation
of the mechanism to synthesize RNA or the mechanism to translate it into protein
_ beco:nes necessary.
In the case of E. coli, the elucidation of these mechanisms has been completed.
However, in the case of B. subtilis, we must await future research res~slts.
For example, a certain Japanese firm is using a bacterium species simila.r to B.
subtilis and is commercially g oducing amylase and goteinase. When bacteria i~i a
culture medium are allo~+ed to propagate, they manufacture protein. Then, ammonium
sulfate is added ~o the supernatent of the bacterial.filtration, much like adding
bittern to bean curds, whereby a large quantity of protein called amylase is ob-
tained.
Using s ~:echsnism such as this, interferan may also be produced by a sim~lar process.
Now that the cioning of amylase has become~p.ossible, the next project is to try to
isolate only that region for the mechanism.
- Next to the application of the primary products now being advanced worldwide comes
_ the ap plication of secondary=pxoducts called the improved p~roduction of antibiotics.
In the third stage, attempts will be made to use microorganisms at the individual
level. For example, a firm called "Eree" in England is growing bacteria that
metabolize methanoZ. Improvement by means of genetic manipulation enabled the
econamical production of a bacterial protein from methanol. This is a famous
patent and is believed to be useful as a feed protein.
As it makes further progress, plant species will be the subjects, and production
of cro ps that are resistant to herbicides or the pr~iduction of apples that
resist diseases will perhaps materialize in 3-4 yeaKS. In the long run, the f ix-
ation of nit:.ogen is also conceivable. ~
However, problems with animals are difficult. It is very difficult to reproduce
one individual from one cell. But it is possible fram an embryonic cell. Apparent-
ly, DNA has been successfully recombined at the e~mbryonic stage in frngs and sea
urchins.
However, ~.roblems with human remain. No g~oblem exists aC the therapeutic level,
but ethical problems such as human remodeling emerge. Thus, a restriction should .
be set in the case of animals becauae there are not only physical hazards, but
also ethical problems.
There is no established prospect as yet, but treatment of hereditary diseases will
certainly become possible in the distant future. In that case, the treatment of
hereditary diseases must be made at the earliest possible stage of development, ,
that is, during the �etal stage. .
8
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAI. USE ONLY
For example, a her.editary disease called "sick3:e-cell anemia" can be discovered
at the fetal stage. It occurs frequently in ~lack children. The disease occurs
only when both parents have recessive genes. The disease can be discovered by
exgmining the cells in the amnion. Eben though it is discovered, abortion cannut
be recommended. This is an ethical problem which is not f ound in Japan, but it is
a serious goblem in the United Sr_ates.
5. National Cancer Center (Takeo Sekiya, Biological Research Laboratory)
Medical Revol~tion in Cancer, Polio, Etc
What we are involved in is basic research using genetic manipulation. Tiny RNA
(tRNA=transfer ribonucleic acid) genes that accurately transport amino acids to
make up a protein are isolated fram a rat, and their structures are analyzed to
deterir~ine which genes are expressed.
~ It is said that 1,000-2,000 tRNA's are pre~ent~in one ai~~~mal cell. When each one
is selected for study, the DNA ch3racteristics of tha.t animal will be clearly
revealed. This is also one of the research goals.
As a result of this study, a series of genetic modes have been revea.led in
eukaryotes such as animals. In the case of prokaryotes such as bacteria, it was
known previously how genes are expressed and what products result. However, in the
case of the eukaryotes such as higher animals and plants, details of the genetic
structure ~nd the course taken for genetic expression were not very clea.r until the
techniques of genetic manipulation could be used.
Studies are being conducted worldwide concerning cells of the la~wer eixkaryotes,
but I think we are the first to work with ma~als.
When various DNA fragments are isolated using tRNA, DNA's of known identity can be
collected. By collecting as many of them as possible, in the future they can be
used, f or example, as material to look for differences between cancer cells and
normal c ells with respeGt to DNA.
- Cells become cancerous because of an abnormality somewhere in the DNA, but the
site of the abnormality is still unknown. In the f.uture, I am sure studies will
be made at that level also, but it is necessary to elucidate the identity of DNA
in normal cells first.
It is also necessary to study what kind of DIdA is related to cancer, and we are
working on this subject.
And the identity of the ger.e in a virus that causes cancer is being revealed. It
is not a particular gene that is in the virus naturally. For example, some genes
in host cells such as murine cells are integrated into the viral expression
~ mechanism and increase abnormally. It is known that this is why the cells be-
come cancerous. Therefore, we may reason that the host cell had the cancer-
causing genes from the beginning.
9
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
Genetic manipulation will probably ma.ke the following things possible.� For
examp le, let us assume a person is an~ic due to an abnormality in the blood-
making genes. To correct this anomaly by insertit~g normal genes into the cells
of that person, I believe, will be possible in the not too distant future.
Another possibility is the polio vaccine for preventing poliomyelitis. A"live
vaccine is being used now. However, the "live" virus being used in this "live
vaccine" is low in its efficacy as a virus to create immunity. Therefore, it
sometimes reverts to the original harmful state and its role as a polio vaccine is
not accamplished.
Using genetic manipulation, only those genes that ma.ke polio cell coats are iso-
lated and inserted into E. coli to produce the protein coat. When it is used as
vaccine, an iffinune antibody is made against it. Then, when the externa.l, real
polio virus attacks, disease can be prevented. This has already been done at the
laboratory level. The application of genetic manipulation techniques in aspects
such as this is being studied actively.
The possibility of a reconstructed man, etc, is often mentioned. However, that
requires enough manipulation to make one faint, and I think it is nearly impos-
sible. But the cloning of a man is technically possible. It involves inserting
- intact genes into, for example, a zygote to have them expr~ss. So, it is pos-
sible to create an identical man. But this is not genetic manipulation. Genes
are not disturbed, but only transf erred intact.
Transfer RNA genes in silkworms have been identified. Both thread-forming cells
and non-thread-forming cells have genes to form the same tRNA, and the difference
between the genes that express and those that do not express is known.
Therefore, the non-expressing genes are replaced. This manipulation has been done
in the laboratory already. However, in order to create an entirely diff erent new
organism, a countless number of genes have to be manipulated, and I believe it is
not practicable.
At any rate, to determine how genes appear in nature is the first thing. When
that structure is revealed, it will became clear as to which genes are important
and which region is necessa.ry to express camplete produets. To confirm~these
points, the cutting and ~oining of genes comprise the mainstream of the research.
Therefore, the laws of nature are not being ignored, but research is being advanced
by applying the laws. We cannot work against nature, and I believe we should not.
What I mean is that we should not destroy the balance of nature as a whole by pro-
du~ing a large quantity of specif ic life.
Working at the most fundamental level of searching in the genes for the unknown, I
am struck by the mysteries of lif e and I believe that more and more unlrnown ele~
ments are appearing. With the complex mechanism of life bef ore me, I am impressed
by it and I have no intention of interfering with it.
10
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
6. Kyushu University Faculty of Medicine (Yasuhiro Takagi, professor)
Aiming at Developing Gene Therapy
_ The work is commonly called "genetic engineering," but this nomenclature causes a
slight misunderstanding. There is no specific scientific field called "genetic
- engineering."
Wha.t is called "genetic engineering" is the technology of manipulating and reeom-
bining genes. The English term "gene engineering" was erroneously translat~d as
genetic engineering. The original term mea.ns gene technique or "gene manipulation."
We may say that the principle of the manipulation technique itself is a sub~ect
that has already bean studied, developed, and the problems settled. Wha.t is to
be done using this manipulation technique is the problem currently faced in various
special fields.
It may sound repetitive, but I emphasize the fact that the genetic mar_ipulation
technique is a technology. Therefore, an expression such as the "fantastic future
of genetic engineering" frequently used in the mass media results from lack of
a correct understanding of the term.
My involvement is in the application of genetic manipulation techniques to medicine.
This includes production aspects such as the production of hepatitis virus vaccine,
insulin, and interferon, which commands a strong societal interest as we11.
However, what I am most interested in is to find out "what kind of structure genes
have and what roles they play." Genetic manipulation techniques are very useful
in such analyses. In short, my resea.rch ob~ective is to analyze "human" genes
using genetic manipulation techniques.
The onset of diseases is caused by both internal and external factors. It is
- known that "metabolic diseases" such as diabetes and gout have genetic factors.
And in the case of "infectious diseases," not everyone is afflicted; :some become
ill and some do not, and it is believed that some internal cause exists.
Such internal factors are, in short, hereditary and are called a predisposition,
and previously there was no way to trea.t them.
This was because virtually no research was bein.g done due to the fact that human
- chromosomes are too complex and it was actually impossible to collect them in a
large quantity.
However, as a result of the advent of genetic manipulation techniques, it became
possible to analyze even human chromosomes by excision of a region and its inser-
tion into an organism such as E. coli that is easily cultivatable and ha.ve it
mul~.iply as the organism propagates.
When this technology is used, the true nature of various diseases can be analyzed
in detail in the future.
11
FOR OFFIC[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000440040052-6
~ FOR OFFICIAL USE ONLY
In particular, there is a hope for treating pitiful congenital metabolic
anomalies--for example, phenylketonuria.
This disease is caLSed when a person, by nature, lacks the gene for the enzyme that
acts in one of the metabolic stages of phenylalanine, one of the amino acids; or
when it is damaged f or some reason. It is complicaied by f eeblemindedness.
It may be possible to treat such patients by the insertion of healthy genes.
To that end, I am now in the process of forming a library of "genes of the Japan-
ese people." It may be called a gene bank.
It consists of cutting genes of the Japanese people into sma.ll fragments using
enzymes, which are then joined to plasmids of E. coli for storage. When this is
ready, if one wishes to study a particular gene, he can withdraw it from the
library f or use.
We do not know when gene therapy will become possible.
However, trusting that a day will come for gene therapy, I am working .to form the
foundation.
I am certain that the researchers of the next generation will make great progress
in elucidating the genetics aspects of inedicine in broad areas by using genetic
manipulation.
7. Kyoto University, Institute of Science (Mitsuru Taka.nami, professor)
What Codes for Replication?
Our research involves an "elucidation of genetic codes that are integrated in a
DNA base sequence."
We are studying various codes integrated in the DNA base sequen.ce. But such work
has been going on for some time.
What is different now is that by a genetic recombination technique, they can be
determined faster than before.
Genetic manipulation is a useful technology for basic research in the life science
fields. At the same time, there is another aspect of creating something by using
this technology. ~
If I speak of our research, for example, when we wish to study the base sequence of
a certain region of DNA, only a trace amount is obtainable as natural DNA. But
by using genetic manipulation, the segment can be multiplied by ~oining it to a
plasmid, and a large amount of research material can be obtained. Because of the
increased amount of material for analysis, research work has become easier.
The determination of genetic codes involves several different types of work. In
~ addition to genetic information, we need to determine which genes have control in-
formation. Or, as DNA themselves increase by doubling, the codes for replication
must be determined.
12
~ ~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICtAL USE ONLY
- Regarding codes for replication, we have been able to determine what kind of
base sequence of DNA is necessary for replication. Pl~smids also multiply, and
some base sequences for this process have been determined.
Codes for controls have also been revealed little by little. Roughly speaking, we
know that living organisms have a very ingenious and highly sophisticated con-
trol mechanism. When genetic manipulation f irst beg�n, there was a concept that
various organisms could be created by genetic manipulation. However, as a result
_ of several years of resea.rch by genetic manipulation, ingenious control mecha.nisms
of a living organism have been revealed, and the concept that any organism can be
created has changed. We can say now tha~ such a possibility is unlikely.
For example, even if external genes are inserted, the controls act to eliminate
them, or not to overproduce them. Sometimes the spliced genQS are destroyed and
e~ected as time passes.
It has happened also that a plan to produce animal genes in E. coli was found to be
impossible due to the fundamentally different ~ene structures. These facts have
been revealed by the advances made in science.
Some think that such control codes may be removed by genetic manipulation. How-
ever, the control process has several stages, and we can say that there is a limit.
At present, the number of bases in human DNA is estimated to be approximately 4
billion. Of these, we have knowledge of only a few hundred thousand.
By nature, living organisms exist based on the premise of regulation. When there
is a dema.nd f or a big change, that organism cannot exist any longer. In other
words, it dies. Such a huge process is not in the field o~' genetic mani~ulation
but belongs to other fields. The cloning of man is not in the field of genetic
manipulation, either. For example, cell fusion is in the area of embryology.
Genetic manipulation does not greatly change the blueprint of a cell itself. It is
a technique within the range of the regulatory mechanism of a ce11.
However, genetic manipulation has made possible the creation of substances that are
obtainable only in trace amounts in nature. Examples include interf eron, growth
hormone, etc. The technique will probably continue hereafter to produce such sub-
stances that are difficult to obtain naturally. In that sense, it will probably
make important contributions.
When the genetic manipulation technique is used, heterogeneous DNA or homogeneous
DNA may be spliced in to upgrade production. In this case also, the genes revert
to their original state after a long period of time, but it is possible to increase
production temporarily.
However, it depends on the objective under consideration: it is possible for same
but not for others. It is believed that the genes that determine the fundamental
~ functions of a cell cannot be manipulated.
13
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00854R004400040052-6
NOR OFFICIAL USE ONLY
In other words, there are genes that are absolutely essential for the survival of,
say E. coli, and it is impossible to increase or decrease such gpnes by a manipu-
lation technique. ~
Genetic manipulation is one of the technologies in life sciences. It is not an
almighty technique in itself, but a means with limits.
8. Kyoto University, Faculty of Medicine (Shosaku Numa, professor)
Elucidating Regulatory Actions of Genes
Our research group, which includes Assistant Professor S. Nakanishi, began re-
searcti on ACTH (adrenocorticotropic hormone) in 1957.
Initially, the ob~ect of our study wa.s the production process of ACTH, which is
_ secreted from the pituitary gland of an animal. We first used the pituitary glands
of cows. Our research procedures can be divided into four stages.
The first stage is research at the level of inessenger RNA (mRNA).
The genetic codes transcribed from DNA to messenger RNA of the pituitary cell are
translated to form the ACTH precursor.
Therefore, we inserted the pituitary messenger RNA into a non-cellular protein
synthesis system (suc~i as malt), and the ACTH precursor was synthesized.
The synthesized precursor was found to be seven times as large as ACTH.
It was also found that B-lipotropins (lipin mobilizing hormones) including
endorphin, a substance used for morphine and preseiit in the body, are present in
the same precursor. This endorphin has an analgesic action and has been attract-
ing attention recently. Since morphine is primarily contained in plants, people
are curious as to +ahy it is present in an animal hormone. By discovering the
presence of B-lipotropin, approximately half of the precursor ha.s been elucidated.
Then what sort of things are presen~ in the remaining half? The laboratory decided
to work on this sub~ect.
In order to determine what sort of hormones are in the remaining half, an attempt
was made to elucidate the structure of cDNA (complementary DNA), which is a copy of
messenger RNA.
When the distribution of the messenger RNA for the precursor in the pituitary
gland was examined, this messenger RNA was found to be present unexpectedly in the
intermediate lobe more than in the anterior lobe, which was found to have one-
third the total RNA in the intermediate lobe.
Until then, the messenger RNA for ACTH precursor was believed to be more prevalent
in the anterior lobe, but it was found to occur more in the intermedtate lobe.
Then we succeeded in removing the messenger RNA from the intermediate lobe in a
pure f orm and proceeded with a study to determine the cDNA structure.
14
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFIC[AL USE ONLY
This became the second stage.
The cDNA was multiplied in E. coli using the technique of genetic manipulation, and
the structure of the cDNA was determined.
As a result, we were able to determine all of the nucleic acid sequences of the
precursor. This elucidation allowed us to predict what kind of hormones should
be present.
Pre~icting the presence of unknown hormones by determination of cDNA structure
in this way was a technique that had not been used by anyone in the world at the
time, and it was also a first in the history of hormone discoveries.
Various hormones contained in this precursor are all believed to be involved in
the body defense mechanism or nerve action, and are considered to be very interest-
ing hormones.
Next, as the third stage, we began to elucidate the structure of the genes.
-(i F[7i(ii'~~~~1)~1)
~ (2 ~~z e2s fc3A+~~
mR~A ~~.:~Y~o~tt~
InRNA �
D\'A
152 828
(3) ~=z7
- (4) ha.
Key:
1. introns (intervening sequences)
2. (numbers represent the number of bases which have been elucidated)
3. = exon .
4. = intron
As a result of long-term research, the messenger RNA structures were proven to be
. discontinuous in the genes of higher organisms.
We were able to prove that the region for coding the previously mentioned hormone
precursor is present in three pieces of fragments on the gene. We were abie to
clarify the genetic makeup--where the messenger RNA is cut and in what part of the
DNA it is integrated.
The area to form messenger RNA is called the exon, and the other area. is called the
intron (intervening sequence). In other words, as shown in the sketch, this gene is
made up of three exons separated by three large introns.
15
FOR OFF[CIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
As the fourth stage, regulation became the subject. It is believed that several
tens of thousands to a million genes are present in one cell of a higher organism.
Not all of these numeraus genes are alert and active; some genes are dormant.
One cell becomes muscle or skin. And, depending upon which genes are dormant gnd
which genes are a~tive, the cells are directed to become muscles or skin.
To determine which genes are expressed and which genes are not expressed is called
"regulation" of gene expression.
The elucidation of this regulation is medically very important.
The "regulation" currently being studied by our graup also involves development,
differentiation, aging, cancerization, etc, of the cells.
Activities in the laboratory are continuing following these stages.
There are turo problems to be studied.
One problem is to discover new hormones using the same approach as when the unYcnown
hormones were discovered for the f irst time based on DNA structure.
Another problem is to elucidate the regulation of gene expression. We may say that
this is a major biomedical problem with respect to its principles.
At any rate, research using genetic manipulation technology is in full bloom. It
is advancing at such a speed that what we considered a mere dream only 10 years
ago is no longer a dream today.
As we turn to medical application aspects, the manufacturing of hormones, vaccines,
etc, is being practiced. This technology is likely to continue to be applied not
only to medicine, but to various fields.
9. Tokyo University, Faculty of Agriculture (Teruhiko Beppu, professor)
Improvement of Antibiotic-Producing Bacteria ~
Our number one research pro~ect is the "improvement of bacterial properties to
produce antibiotics." ~
Specifically, two aspects of the research may be cited: 1) upgrading of anti-
biotic productian, and 2) changing the morphology of the conventional antibiotics
(genetically changing the bacterial properties). In other words, our goal is to
develop the antibiotic-producing function of microorganisms. Microorganisms that
produce antibiotics include Actinomyces species, B, subtilis, etc.
First, Actinomyces are widely used in practical applications. One example.is
streptomycin, known as the therapeutic drug for tuberculosis. When the host-
vector system of Actinomyces is elucidated, we expect that stability and safety
of bacterial strains, their large-scale cultivation, and high-purity mass produc-
tion can be achieved.
16
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
B, subtilis is also called "Natto [fermented beans] bacillus" and is a familiar
microorganism to the Japanese people.
- It is expected that regulations concerning genetic manipulation of B. subtilie
will soon be approved. Justification for the approval of B. subtilis includes the
following four points:
1. B. subtilis is a gram-positive bacterium, and it will allow the possible
development of a complementary system to the system developed with Escherichia.
coli, which is a gram-negative bacterium.
2. B.subtili~ produces important applied enzymes such as amylase, protease, etc,
used in drugs or detergents. Furtherffiore, it has the ability to secrete such
enzymes to the bact~rial milieu. In other words, it is capable of ejecting the pro-
tein that was formed within its body. Since insulin and growth hormone are also
a type of protein, if it becomes possible to have B. subtilis produce them by
genetic manipulation, it may become possible to have them spit out antibiotics
such as insulin [as published].
3. B.subtilis f orms a spore. This is a biologically important phenomenon called
a morphological differentiation control mechanism, and it should be a useful
cha.racteristic for research in this field as well. It does not exist in E. coli.
4. B. subtilis also has an outstanding feature with respect to saf ety because it
does not parasitize the human body by natur~.
Thus, B. subtilis has superior characteristics, and we have been developing the
host-vector system for B, subtilis. As a result, we have succeeded in producing a
B. subtilis tha.t is more suitable for genetic manipulation. It is also being
used by investigators in other laboratories.
In addition, we are conducting research into cloning of animal genes using the
- E, coli host-vector system. Specifically, it relates to an enzyme called rennin
tha.t can be extracted from the stomach of a cow. This is an essential enzyme for
ma.nufacturing cheese, and it is conceivable, in the future, to produce rennin for
practical use using E, coli.
Enforcement of the guidelines may cause problems in carrying out future research.
According to a scientist in West Germany, their work is based on guidelines which
have already been reviewed for the third time based on research results. And the
fourth revision is now being studied. On the other hand, Japanese guidelines are
still in the f irst stage, and at long last, the first revi3ion is being con-
sidered. A~ the present stage, Japan is not keeping up with the world situation.
And dissatisfaction is sometimes expressed to the effect that the operation of
the guidelines should be more sensitive to the movement.
Next, I would like ta discuss the future of genetic manipulation. Currently, the
news of interest to mass media is reported in a confused state regarding whether
, it is a short-term or long-term project for realization, and it readily causes
misunderstanding.
17
FOR OFFfCIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
It is necessary to consider pro~ects by dividing them into short-term goals tha.t
are technically Yealizable, and long-term goals that require a considerable time
for realization.
One of the short-term studies is to produce human peptide hormones and viral
vaccines using E. coli. In other words, animal proteins are to be produced lxy
E. coli.
One of the longer term studies is to create rice plants that can fix nitrogen. ;
This will be an epoch-making quality improvement. Fuel production using micro- :
organisms is also conceivable. .
Currently, experiments are under wa.y in Brazil to run automobiles with fuel pro-
duced by adding alcohol to gasoline (gasohol). If this alcohol can be produced
~ in the future using microorganisms for alcohol fermentation, it will play a role
in solving the energy problem. Besides these goals, there are many dreams, but
we must realize that long-term studies are necessary to make them come true. ;
In addition, intermediate term research may concern applications to the imgrovement
of antibiotics. ~
~
From now on, more and more emphasis will also be p~aced on fine chemicals i:n the i
fermentation industry, and the field in which man will use the unique catalytic .
function of living organisms (especially microorganisms) will ~expand even more. ;
10. Society of Microbiochemistry (Kunimoto Hotta, Department of Microbiology, '
Microbiochemistry Research Laboratory affil~.ated with the society) ~
J
r
A Beginning in Therapy and Hygiene tJith Actinomyces t
~
My work is mainly concerned with studies of Actinomyces that produce antibiotics. ~
Currently, some 5,000 antibiotics have been discovered. I am interested in the ~
fact that Actinomyces produce so many antibiotics with different structures. If.
we can find out where that function liea, we may be able to have other bacteria. ,
produce antibiotics by transferring, the gene,to them. When we use ba.cteria with
- different properties, they may produce entirely new antibiotics dii~.ferent from
those produced by Actinomyces. Therefore, we decided to studq the fundamental
biochemical nature of Actinomyces.
In about 1975, the plasmids of Actinomyces were proven to be related to the pro-
duction of antibiotica, and concurrently, the,technique to cut and splice genes
using restriction enzymea spread w~orldwide.
Therefore, we thought antibiotics could be produced in E. coli if Actinomyces
plasmids were spliced into E. coli plasmids. It was expected that E. coli could
produce entirely new antibiotics by using the genetic codes of Actinomyces. Thus,
we also began those st~dies.
A detailed explanation of the process is as follows: First, in order to obtain
proof that Actinomyces plasmids are related to antibiotics production, we used an
18
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICIAL USE ONLY
agent called acridine dye. Acrydine dyes are agents which used to be called
plasmid removers. When Actinonyces bacteria were treated with this dye, many
Actinomyces bacteria that cannot produce antibiotics were obtained. Then, we
treated approximately 20 species of Actinomyces having plasmids from our labora-
tory with acridine dye. Although Actinomyces became incapable of antibiotics
production, many of them still had plasmids. This proved that acridine dyes are
' not necessarily plasmid removers, and that it cannot be simply said tha.t plasmids
are related to antibiotics production.
This posed questions as to what function the Actinomyces plasmids have, and what
can be done to have E. coli produce antibiotics.
Until we can answer these questions, it is impossible to intentionally produce
antibiotics or create new antibiotics. Therefore, we are presently in the stage
of research studying the basic properties of Actinomcyes.
One method is to insert Actinomyces plasmids whose properties are not known into
E. coli using the genetic manipulation technique and infer the role of the plasmids
inserted by observing the changes in E. coli. At the same time, applied research
being conducted includes the transferring of plasmids proven to produce antiobiotics
into E, coli by using genetic manipulation and planning the mass production of
antibiotics, or attempting to extract new antibiotics. The newly opened field of
antibiotics research by genetic manipulation made it possible for us, f irst, to
expect that the mass production of antibiotics is possible; second, to anticipate
the discovery of new antibiotics; and third, though it may be in the distant
future, to anticipate a method to create new antibiotics intentionally. Based on
these prospects, I believe that the field of inedicine has greatly extended its
base and made a revolutionary beginning in thera~peutic and hygienic research.
These three points are entirely new possibilities.
However, due to the great lack of information on Actinomyces, research is at a
standstill and not much progress had been made. ?f the mechanism for antibiotic
production by Actinomyces can be elucidated, I believe that it will have a direct
bearing on the increased productivity of antibiotics and the discovery of new
drugs.
Among the bacteria that are curr.ently causing problems are those called resistant
bacteria. They are bacteria that are resistant to antibiotics and cannot be
killed by using antibiotics. And it is no longer only a dream to discover new
antibiotics that are effective against these bacteria.
Incidentally, genetic manipulation became an issue at one point in that it ma.y
produce microorganisms harboring great risk for human beings. However, this is
apparently an unfounded fear, because the bacteria used for research are species
that are confirmed to be harmless to humans. Moreover, experiments are being con-
ducted by investigators within the framework of the guidelines of the Japanese
prime minister, the Science and Technology Agency, the Ministry of Education, the
Ministry of Health and Welfare, etc.
However, there is an aspect that does not so easily give us peace of mind. Since
Actinomyces themselves are naturally occurring bacteria, what will Iappen when the
19
- FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OMNICIAL USE ONLY
plasmids of o~her bacteria are inserted into an A~ctinomyces as the host. ThJs
bacterium as it is has the possibility to survive in nature. Among the
Actinomyces, those which are considered definitely safe must be used as hosts.
For now, the situa.tion is one of orily relying on the conscience and good intentione
of the researchers. Fortunately, in Japan, research is being conducted with
safety as the foremost factor, in accordance with the initiatives taken by the
researchers. Organs to check research substances are being established as much
as possible.
Recently, beginning with artificial insemination, terms like mutant and cloned man
are being used frequently by the mass media. Although its realization is erroneous
[probably an error for distant], when biology makes further progress, the ethical
or moral views suitable for that time ~aill become necessary. This is already a
philosophical problem. The risk that it will end up in an unexpected direction is
latent in such situations.
Finally, there is one thing that I would like everyone to laiow. That is the fact
that genetic manipulation is not an almighty tool. It is merely one means to
elucidate the secrets of living organisms. However, it is certainly a powerful
means.
11. Osaka University Medical School (Kenichi M~tsubara, professor)
Toward Eradication of Hepatitis B Virus
Our research objectives are two-fold. One is the elucidation of the genetic
structures of viruses, and the other is research on plasmids.
For the elucidation of the genetic structures of viruses, two kinds of viruses are
used: one is a carcinogenic virus called Y73. Y73 is a virus that causes cancer
in chickens, and it was discovered in Japan. We have begun chemical studies of
the gene sequence of this virus. We are trying to determine which codes of the
gene cause cancer. We have just taken out ttiat gene, and are having.it ~ultiplied
in E. coli using the genetic manipulation method. A period of approximately 6
months is necessary to decode the carcinogenic codes.
The other viral research relates to vaccine production of hepatitis B virus, and
we are participating in this as a member of the research team of the Ministry of
Health and Welfare.
Hepatitis B virus is a very virulent type, and even a very small amount causes
hepatitis, sometimes leading to cancer of the liver. Moreover, it has the trouble-
some characteristic that it causes hepatitis only in humans and not in other
animals.
The vaccine for hepatitis B virus is the special protein coat (antigen) produced
by the virus itself. When this antigen enters a human body, it produces an anti-
body in the body against this antigen, and immunity to the disease is produced.
Therefore, the plan is to take out the gene that makes the protein coat to become
the antigen from the hepatitis B virus using genetic manipulation and transfer it
20
~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICIAL USE ONLY
to E, coli. We are now at the atage of having just isc~lated the gene, and it
will be multiplied in E. coli next for el.ucidating the structure. By doing so,
while assuring safety, a protein coat of high purity to become a vaccine can be
produced in large quantity. It will enable the production of vaccine with a high
concentration of the effective protein.
On the other hand, we are also studying plasmids. Plasmids are genes that self-
replicate by entering cells such as bacteria.
The plasmids of E. coli are being extensively studied. Of these, we are working
on two kinds of plasmids in particul~r. One is lambda dV, and the other is the
so-called F factor.
The objectives of the research are to find out why plasmids can autonomously
replicate, and lnw this is regulated. This may be said to te a necessary work to
elucidate the secrets of how human chromosames and bacteria undergo cell division.
Lambda 3V has the most numerous copies among the natural plasmids, and the F factor
has a characteristic that only one is present in a cell. When these two kinds of
plasmids are studied comparatively and their differences and similarities are
elucidated, I believe the secrets of self-replicating.control can be determ~ned.
At present, of the approximately 3,000-nucleotide (base) sequence of the plasmid
lambda dV, a 2,468-nucleotide sequence has been determined. In addition, several
tens of genetic codes are known in this nucleotide sequence. For example, a se-
quence for the starting point of inessenger RNA synthesis called a promoter has
been found. Linked behind it is a portion that acts as a switch for messenger
RNA synthesis, called the operator. At the opposite side of the operator, a
region called the terminator is found, which is a code to terminate the ma.~ority
(approximately 90 percent) of inessenger RNA syntheses; and~on the side of ~he
terminator, a switch for the terminator called the N-action region is found.
In other words, it has been elucidated that the function that controls genetic
replication is a complex mutual surveillence sysCem with motors and control
switches comprising several tens of circuits. The details are omitted, but you
can judge, to a c:ertain degree, at what level the molecular biology of today is
situated.
The method used in elucidating the base sequence of lambda dV ma.y be used to re-
~ veal the regulation and control mechanism of gQnes of higher animals using the
genetic manipulation technique.
The plasmid research will be the first step for the elucidation of survey
[probably an error for regulation] and control that take place in a human body; for
example, to find out why brain cells do not multiply and skin cells do multiply.
In addition, plasmids can also be used as vectors, and it will lead to the develop-
ment of safe vectors. As understanding of the control function of plasmids pro-
gresses, it will involve the productive function of hormones, vaccines, the often
talked about interferon, and insulin. The contributions to the development of such
pharmaceuticals are expected to be in considerable magnitude.
21
FOR OFF[CIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R044400040052-6
FOR OFFICIAL USE ONLY
Next in development will be the genetic manipulation technology used for agri-
culture and the food industry. One example is the development of rice plants that
fix nitrogen from the air.
On the other hand, there is talk of inethods to reconstruct living organisms.
However, this is not a method to manipulate genes, but a study of inethods for free-
ly handling cells, that is, cell technology. This technology is theoretically
possible. ~Te may say that realizable programs already exist.
At the time of the historical appearance of genetic manipulation, various risks
were d:t.scussed at the beginning. Undoubtedly, it was said at one time that if
genes, where the historical species barriers of living organisms exist, are com-
bined, the birth of unthinkable living organisms could occur by a sympathetic
phenomenon. However, this risk is experimentally denied at present.
At any rate, there are people who believe genetic manipulation to be a revolution-
ary technology and hold many visions for its application, or who hold great fear
of danger .
However, whether it is a vision or a sense of fear, in order to obtain some
results by genetic manipulation, a correct understanding of today's genetic
manipulation is desirable. It is still some time ahead when this technology can
be freely used to obtain some results. It is certain, however, that mankind has
made his first new step forward.
12. Nihon University, Department of Agriculture and Veterinary Medicine (Fumiharu
Maruo, professor)
Practical Application ef Transformation Technique
At the beginning,.we were ~onducting research on the enzyme production of B.
subtilis using mainly biochemical techniques.
However, in 1963, a mapping method for B. subtilis genes using the DNA transfor-
mation technique was published. Then, we considered the possibility of applying
the transformation technique to studies of the enzyme productivity of B. subtilis
also.
Transformation is a phenomenon manifested when a DNA from another source is insert-
ed into the DNA of a certain cell, and the inserted foreign DNA is integrated,
changing the cha.racter of the cell.
The phenomenon of transformatian itself was discovered by a bacteriologist named
Grif f ith in 1928.
However, the elucidation of the cause required many years, and only in 1944 wa.s it
finally proven by Avery and others that transformation is caused by tYce action of
DNA.
But it required more years again until this was accepted by the scientific com-
munity. This was only natural since it appeared contrary to common sense that an
22
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FOR OFFICIAL USE ONLY
extremely minute amount (0.001 microgram per milliliter) of DNA given can cause
the genetic character to enter into a live bacterium and recombine.
It was in the 1950's when the fact that transformation is indeed carried out by
DNA was generally accepted.
The Applied Microbiology Research Center was established at Tokyo University in.
1952.
The professor at that time was Dr S~ Akahori, now at Osaka University, and research
began on the mechanism of enzyme synthesis by microorganisms. Thus, studies on
the live synthesis of a-amylase (an enzyme that digests starch) began using
bacteria called B. subtilis.
In 1958, the fact that transformation by recombinant DNA is possible with B.
- subtilis was reported. Using this method of transformation, research began on
the genes that control the production of a-amylase.
As research progressed, it was revealed that many different genes are involved in
the process. These genes when changed demonstrated an action to increase the
production of amylase 2-S times. They were experimentally inserted into one cell
sequentially by a transformation technique whereby the presence of regularity was
discovered and it was found that these genes act synergistically and the produc-
tion of a-amylase is drastically increased.
At the beginning, the result was about 10 units, which has now been upgraded to
approximately 30,000 units, and crysta'ls are now obtainable quite easily.
I believe this is the first example of the practical application of a transforma-
tion technique.
In the future, when manufacturing alcohol from starch, f or example, it has the
possibility of being ~ery useful.
In other words, starch is decomposed into sugars, and the sugars are fermented with
yeast to produce alcohol. This saccharification process should also be useful on
an industrial scale.
Alpha-amylase is but one example, and this law will naturally be applicable to
cases for upgrading the production of heterogenous enzymes, proteins, etc, tha.t
ha.ve been recombined into bacteria.
I believe that the genetic manipulation technology will advance in a straight
course for the next 10 years or so by using the principles that have been revealed
thus far.
I think it will first go a~ far as it can before the end of the century.
For example, the progress made in computer technology is an eye-opener. It was
also around 1955-1956 when computers were fi~st made using vacuum tubes.
23
= FOR OFF[CIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFIC'IA1. USE ONL,Y
- Improvement of a-amylase production of B. subtilis
. ~~~10~ a-P:7=-t'.~~'I~~~lt~ � '
. . , � ,ab ~ . . . . �
. � . ' CS108 ~ooo ~ ~eooo
~ ~ ~'ao ~ ~ . 630T2 T2N26
1212 ~ .
~o' ~ so zoo .
~ j 6160: . NA64 B7 ,
_ ' . 130 ' ~ , :
SAC ~ ~ ~
~ ~ zoo ,zoo .
~ SP38 TM23 .
~PN~1{t~i#k~~n~e #~~~.~Y~c=;-13~o~pi~t~~'~'~('~'~ Q-7 c i-~11:1;_'. !,.I~~~:t'xcr#Hle~
f'>fi~n;'!'#*~ DNA t~X~~"s24"s~t_~.3~1r, 6~~~:~tt~:m~~i~t_.k3'~ir~%J:l'o
Footnote) Within the boxes are abbreviated names of bacterial strains. Numbers
above the boxes show a-amylase units produced by the bacterial strains. Filled
broad lines show changes by transformation using DNA of the strains shown by thin
_ lines; and the blank broad lines show changes by mutation.
When I was in the United States (1956), a laboratory next to ours at the uni-
versity (Pennsylvania State University) was conducting crystallography research
using a vacuum tube computer.
In the less than 30 years since then, today's state has been achieved.
The principles of the mechanisms of living organisms that ar~ about to be applied
were revealed in 1960. The mechanism of protein synthesis, that is, the mechanism
that began with DNA to form protein, was elucidated about that time.
One of the most difficult problems in biochemical research lias been the studies on
protein synthesis. Toward the end of the 1950�s, protein synthesis became possible
with enzymes extracted from cells. Then it was proven using E. coli etc, that
messenger ribonucleic acid (mRNA) determines the amino acid sequence of the protein,
and the decoding of genetic codes was accomplished.
The messenger ribonucleic acid is synthesized according to the order of the base
sequence of chromosomal DNA, and amino acids are arranged according to that base
sequence, whi~h becames proteins and enzymes.
As a result of the elucidation of this mechan~sm, a field in which biological
phenomena are elucidated at the molecular level was born as molecular biology.
In that sense, that year was the.epoch-making year for biology.
In the 29 years that followed, rapid developments have been made. Especially, in
the field of genetic manipulation, new experiments are being attempted one
af ter another.
~
- 2J~
, ~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICI�AL USE ONLY
As has been stated, a marked research development has been accamplished regarding
the mechanisms inside individual microorganisms, and rema.rkable progress in applied
technology will be seen. However, a population of living organisms and their
relationship to other organisms are the aspects tha.t remain the most difficult
problem.
Recearch in these areas is still incapable of breaking out of the realm of record-
ing science by relying upon experience. As a result, a solution has not been
f ound so easily other than that based on conventional experience in problems such
as waste water disposition and red tide.
The reason is that the principle of interaction between organisms has not been
elucidated at the basic level.
The pursuit of a basic principle regarding the interactions of living organisms
not limited to microorganisms is one of the biggest problems left to the future.
13. Tokyo University, Faculty of Agriculture (Keiji Yano, professor)
Studies of Bacteria That Work for Nitrogen Fixation
We have learned by experience that "melon vines do not bear eggplants." However,
the elucidation of the principle of life made it possible to take out a portion of
the function inherent in a living organism or species and have it express in
another living organism. And astonishingly fast technological progress is being
made.
Thus, research on the techniques to manipulate genes came into the limelight wlth
almost abnormal brightness. In the meantime, there were various misunderstandings
and imaginations held by some who seem to be concerned that new creatures might
be born any time and the likes of a mermaid or a chimera might pop out, thus
fanning the trend to emphasize the risk of genetic manipulation unnecessarily.
For example, studies have been made to have E. coli produce human insulin. If it
can be mass-produced at a low cost, it is a great blessing to diabetics. Need-
less to say, all precautions must be taken since the effect of the producing bac-
teria that happens to enter the human body is unknown.
In our daily life, there are items entailing risks such as electricityr gas, auto-
mobiles, etc, which we are using for convenience with skillful control over them.
The same is true with genetic manipulation. Judgment as to what kinds of experi-
ments should be conducted must be controlled based not only on scientific knowledge,
but also on ethical and religious views (reverence for the natural system including
human beings).
As we state that it entails risk, we cannot overlook the fact that the term "risk"
is sometimes misunderstood, which is one of the important factors that interf�eres
with correct understanding. Incidentally, many English-Japanese dictionaries trans-
late the word "risk" as "danger," but English-English dictionaries such as the
Oxford define it as "a chance (probability) of incurring injuries or losses." In
other words, risk is not the "danger" itself, but it is a probability of incurring
risk.
- 25
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOK OFFIC'lAi. USE ONLY
We understand genetic manipulation as nothing more than a"technology." In
Europe and the United States, genetic manipulation is rapidly being incorporated
into the life sciences as a technology, and no inconvenient accidents have taken
place in the course of experiments using this new technology. The big fuss made in
Japan is, so to speak, the sensation that occurred in the United States around
1975. First, it must be understood calmly that it is a mere "technology."
We are not steadily conducting genetic manipulation experiments in our laboratory,
either. First, we have no such funds. A common example is that the research
funds provided by the government for one graduate student is 200,000 yen annually
- for post-doctoral research. For the entire laboratory, it is a mere 2 million
yen. How sma.ll the budget is in the Ministry of Fducation may be understood.
Even if we include the scientific grants, it is still tight. It has been 4 years
since the~laboratory was built, but the facilities are not completed. We are
now in the process of making a preparatory set-up so that we can k~egin exgeriments
as soon as the facilities are completed.
The current major effort is placed in studies of nitrogen fixation. Japan is
lagging considerably behind in this field. The United States and England are tak-
ing the lead. However, we are advancing the research fram an entirely different
viewpoint, and in that sense, I believe we can state that it is a unique research
prcject in the world.
The first problem in nitrogen fixa.tion is that the system is oxygen-labile. Nitro-
gen f ixation does not occur smoothly where oxygen is present.
There are ideas such as using plants to produce nitrogen. However, as you know,
plants release oxygen. Thus, it is difficult to incorporate it with a system that
is oxygen-labile. Most of the research in nitrogen fixation in the world is head-
ing in the direction of how to break through that obstacle.
Hawever, the research we are conducting is slightly different, in that it begins
with the premise that there are nitrogen-fixing bacteria that cannot survive with-
out oxygen. This is the blind spot of nitrogen fixation research in the world.
In other words, we are "studying bacteria that work to fix nitrogen in an aerobic
environment."
Now, the reason why genetic manipulation is attracting attention is that the
demand is there, for example, to have microorganisms produce interferon or to ha.ve
microorganisms shoulder the work only human cells were doing before. Consequently,
the microbiology industry that 3raws out and enhances the ability of micro-
organisms will probably develop worldwide in the future.
It is also closely related to the energy problem. The price of petroleum has
increased 20-fold in the past 10 years. Moreover, the amount of petroleum is
finite. We must eliminate such waste as ~ust burning oil for energy. Take con-
ventional chemical reactions which require a high temperature such as 100�-200�C.
If it can be lowered to the level of our body temperature, that much oil can be
conserved. If the biochemical reactions being carried out in the living body can
be applied to develop such energy-saving, high-efficiency chemical reactions, so
26
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFIC'I~L USF ONLY
much the better. The existence of microorganisms is significant in that sense,
also. For example, tissue cultures derived fram the human body die in about 50
days [probably an error for 50 passages], but microorganisms are longer lived.
Speaking of nitrogen fixation, the indispensable nutrients for cultivating micro~
organisms for usQ in the future are a carbon source and a nitrogen source. If they
can make the nitrogen on their own, tihat much less material is needed. In that
sense, it is not only important as an agricultural fertilizer, but to support the
future development of microbiology industry. The creation of bacteria that are
nitrogen-self-sufficient is desirable. That is the goal of our research. I have
9 years or so before retirement, and I hope to achieve this goal by then.
Finally, if I may present an introductory explanation of the current state of
genetic manipulation technology, it may be easier to understand by using the analogy
of the editing operation of a sound-recording tape. Qne does not cut and join the
tape at random; one must examine f irst what information is on the tape. To do so,
it must be set in a taperecorder. The taperecorder is equivalent to the cell. The
cell transmits its own characters to its offspring, and that is done by the
action of the main chromosomal DNA. It may be considered as the tape. However,
unlike cassette tapes, the cell's tape is too large to take out. If taken out,
it comes apart in pieces. In other words, the main chromosomal DNA is an endless
tape wound on a nonremovable reel. The main chromosomal DNA itself cannot be taken
out or processed at this stage as yet.
Thus, it is transported on a carrier called a vector. The insertion of heterogenous
DNA into that vector is equivalent to editing in the case of a recording tape. To
do so, a special enzyme called restriction endodeoxyribonuclease is used instead of
scissors and paste. In this manner, DNA is artificially manipulated, that is (the
gene is) grafted.
To avoid misunderstanding, I would like to state that as long as the main chromo-
somal DNA cannot be handled, it is erroneous to say that new species.of organisms
can be artificially created by genetic manipulation. It is simply a technique to
insert an ability which an existing organism did not previously possess.
14. Tsukuba University, Biological Sciences (Kunio Yamane, assistant professor)
Mass Production of Food Using B. Subtilis
The subject of our research is "the production of heteroprotein using B. subtilis."
Heteroproteins are proteins of other than B, subtilis such as interferon, soy
bean protein, etc.
B, subtilis is not as well known as E. coli, but it has a role in the recently
developed genetic manipulation as a host, and it is useful bacteria in various
phases of future applications.
A ban on B, subtilis has just been lifted. It is the bacterial species that is
also present in fermented heans, etc, and produces many kinds of exoenzymes such
as a-amylase, protease, etc.
27 .
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00854R004400040052-6
FOR OFFtC1AL USE ONLY
Thus, in order to examine which genes control the production of these enzymes, and
through �,uhich pathway these exoenzymes are synthesized and secreted into the media,
we have been conducting research using a-amylase.
B, subtilis does not parasitize the human body, it does not produce toxin, and its
mass production is simple. In addition to these superior characteristics, it
secretes exoenzymes such as amylase, which make it more useful tha.n E. coli.
B. subtilis releases enzymes to lyse starch, cellulose, etc, to obtain its nu-
trients such as glucose.
Thus, in our study, we succeeded in inserting the gene that produces amylase into
the phage (virus) of B, subtilis.
This was successfully done, but a difficult problem appeared. Not all the phages
obtained produced amylase, and as a result of inserting the amylase gene, the
phage itself became weak, ma.king it difficult to recover clean amylase.
Many trials and errors are being made regarding this problem. At the moment, we
are experimenting by inserting the amylase gene into E. coli instead of B. subtilis.
What is the significance of this research? Foi exa.mple, genes for producing
insulin, interferon, or whatever else, are spliced into the amylase gene.
Then,'-B. subtilis works hard to produce substances, thinking the inserts are
- amylase genes, but in fact it is producing something else such as interf eron,
insulin, etc.
When 1 liter of amylase [as published] is cultured, 2-5 grams of amylase are
recovered. If, for example, an interferon gene is spliced into such an organism,
interferon in gram units can be produced. In other words, the ob3ective of the
research is how eff iciently the target substance can be obtained from a small
amount. I am planning to work on the pro~ect for about 10 years. In short, the
goal is how to make the scientifically produced clones useful in industry.
Recently, so-called "genetic engineering" has been in the limelight. I do not
quite understand why such a fuss is made over it. Undoubtedly, it is revolu-
tionary.
What used to be impossible is now possible. For example, the crossing of dif-
ferent species was absolutely impossible before, and the fact that it has been
made possible is revolutionary progress.
But we do not yet know how much of it can be directed to be really useful in human
life. In that sense, it is still at the basic stage.
As future problems, there is nuclear fusion for the energy problem, and biology
for the food problem. Genetic manipulation is essential in that process.
+
28
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAI_ USE ONLY
At any rate, take rice for example; no chemical synthesis can produce such
- delicious rice. Therefore, rather than elucidating the principle, the main re- �
search will probably be in the direction of how it can be mass produced in high
yield.
Incidentally, the human lifestyle has been made more convenient by scientific
developments. And as we contemplate what sorts of things people will desire in
the future, they may include such things as prolonging life, developing talents,
developing ability for prediction and telepathy, or the modification of inental
structure.
However, it is questionable as to how much such things as the extension of life
can correlate to human happiness.
Genetic manipulation technology is closely related to such problems of how to live.
It may be that the technology may not be considered to be useful for improving
human life.
Therefore, I believe it should be held at the level for the mass production of food
or the improvement of inedicine.
I have been studying a cellulose-decomposing enzyme, cellulase. I have been
- studying how "paper'' can be changed to an edible state for humans by using
cellulase.
At present, I am collaborating with people at the Science and Technology Research
Laboratory in studying the use of wastes such as converting the city trash, not as
far as food, but possibZy into feed for pigs. I think that cellulase may be
useful somehow.
At any rate, to pour oil and burn the trash is wasteful. It may seem muddy for
people in the physical sciences, but su~h research is the target of agricultural
- chemistry.
C~rrei~cly, new cir~+~~ .~~~zed chemi.cally oL puu~~cologicalZy are L~~n~ used.
It will be some time in the future, but I would like to produce, if possible,
- high-qualir_y drugs of biological origin.
By doing so, those which were toxic before become non-toxic.
In short, I would like to replace the products of science and technology with
those of biological origin.
The above articles, "Reports From Research Laboratories," were compiled by the
editorial department based on conversations.
Legends for photographs:
1, p 93. Bacteria used in gene experiments (in U.S,A.)
29
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFIC'IA1. USE ONLY
2. p 95. Three mice created by nuclea.r transplant (in Switzerland)
3. p 98. Rapidly advancing research in the U.S.A.
4. p 198. Photograph of alpha-amylase crystals ~
COPYRIGHT: Ushio Shuppansha 1981
7722
CSO: 4105/176
30
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OF'FICIAL USE ONLY
SCIENCE AND TECHNOLOGY
FUTURE ENERGY SAVING STRATEGY OF PRIVATE INDUSTRY DESCRIBED
Tokyo NIKKEI BUSINESS in Japanese 15 Jun 81 pp 36-45
[Text] Figure below shows to what extent the main industries can conserve oil.
~ Figure 1. Oil Conservation of Main Industries
- - - - _
C1, ~ 13.40 (1 million kiloliters) (Note: Arrox)
j~~,~~~ fi, oil consumption in 1985 (after oil conserva-
~2~ , 7 ; ,f.~r,~,~ -~:~saoc~~~~~�~~ tion program)
~ S'f~h 71~i1~IW1/I~~~iw~~' .
� ...aa,.:~r;~l:;~::~fi~_~~- ~ s.so( ~h~f ) 16.30 (1 million kl ~
- _ ' sa~~ 1979 (xote: 8haded area
~3)~_ z.oo-+;~:~,~ 2.0~1985 ~-~-ea~aso~~_h~f3~:~,;w;~(t~T:~j~)
~ :
. . . _ - � Z.s ~ 2 . 91=1979
/4~ . . . . . . ir:s~7'
~ a�'~ _~1 1.68
_ x- f .L, . t . . . . . . . . . ; - x. -'8 69
/ ~ . . ' . .41. ~7i
\5~.~iid4r~ ,f ,E. yP_r-_ .~27t7
%
. l '~._"r ' a _ _
b ~ ~a~'
~ ~ a;A=v-9
. . Gh1
n ~K
::4.20";'
nso
- (8\ - . : . .~vw:,.~.~w.~w.~�. ..~..xr~.ronpra�~9Q9r`�~
\ 1 kr.: . - - ` 3.76
' S.3J ~ :'/~:'��`~:,�Jr3
~9) t,t,h , ,
- ~ 9.29
- 2.95`/
):~~i'1,'s~ a"~
,
- % . 7
~11~ -~4~ 1979 60'F -198 - .
_ ' - tt~._ . ~ " i' ~~'`w �:~~,;~~r
E3 ~k~4~ A . , ~ , ~ r..~ ;
~�ntk ~ ~ ~l~t~~~~r~.%`'.'~ ' ~ i
~ :
' � ti~+ 17'~+A? ~ ~ / ~ ~ d . v/ -.esn:di~
/ , .
; ,
. ~ _ - -
a,~�h, : F3X~~~~t~rr~'~;i
Source: 3urvey of the Industrial Bank of Japan Ltd.
[Key on next page]
31
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY ,
Key:
1. Extent the main industries 6. Electrolytic soda
can conserve oil 7. Artificial fiber '
2. Steel 8. Paper and Pulp
3. Aluminum 9. Cement
4. Oil refinery 10. Large retailing
5. Petrochemicals 11. Japan's total
Oil Decreases as Economy Grows
Energy-conservation products abound in the city, while factories are making frantic
efforts to recover and reuse waste heat. Because of this state of energy-conserva-
tion fever, one can see at a glance that an unforeseen pattern has begun to develop
in Japan, where in spite of a decrease in oil consumption, real economic growth is
rising.
It can be said that significant reaulta have been achieved in energy censervation
and lessening dependence on oil, but as a result indications of a slight change
have begun to appear in the energy-conservation fever. The "Soala" model [as
published], which Toyota Motor Co Ltd began to sell recently, is a sports car
boasting high driving performance and styling rather than fuel economy and is the
first car in a long time which does not push fuel conservation as its selling
point. At the Chiba factory of Sumitomo Chemical Co Ltd, because maximum effort
was put into the recovery and resue of waste heat, "half of the boilers, which
are important heat sources, are idle" (statement by Rintaro Ishiwatari, director
- and engineering chief, Sumitomo ~hemical Co Ltd). Comparing automobiles and
petrochemicals is not a logical analysis but it should be pointed out that over-
emphasis on energy conservation could lead to loss of certain customers and deny
full use of existing facilities. Apparently, the world is changing.
According to Noboru Makino, vice president of Mitsubishi Consolidated Reaearch
Center, energy conservation can be divided into three phases. The first stage
is conservation through daily economy applications, repaira, improvements, etc.
The second is plant and equipment inveatments for energy conservation. The third
is alteration of the production proceases through technological renovations. Of
course, money must be apent even for the first stage, but the amount is not too
big.
Investment Return Will Take Longer
According to Mr Makino, Japan has already completed the first phase and has
entered the second phase. The third phase is planned for 1990's and beqond. So,
we have decided to call the preaent second atage the "Second-Phase Energy Conser-
vation Age." ~
As far as the second phase is concerned, to be more specific, there will be a
substantial increase over previous years in energy conservation costs and at the
same time there will be cases where the overall efficiency would be higher if
energy conservation investmenta were not made.
. 32 , ~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-04850R000400040052-6
FOR OFFICIAL USE ONLY
The following is an example.
Nobutoshi Omodaka, director of O~i Paper Co Ltd, states: "We will be in trouble
unless oil prices rise. The reason is that the efficiency factor of energy conser-
vation investment would decrease." Needless to say, Omodaka is half ~oking, but
looking at the recent oil situation, there might be "concern" in the hearts of
those responsible for energy conservation that in the unlikely event oil prices
do not rise, the investments made heretofore would be futile.
The spiraling oil prices have begun to collapse this year because of worldwide
- easing of demand. At the recent Geneva conference of OPEC, it is reported that
there was agreement on a 10-percent reduction in oil production and on Saudi
Arabia's proposal of a$2.00 increaEe per barrel, but it is debatable whether they
can be implemented. In fact, because of the energy economy of consuming countries,
rumors are flying today that "the third oil shock, which was anticipated for 1985,
will be postponed 10 years."
At present, because of the skyrocketing increase in oil prices due to the second
oil shock, director Ishiwatari states: "The area for energy conservation has
expanded and we have not yet completed the work." Director Omodaka also states:
"FY-81 investments for energy conservation and alternate energy sources total
7.5 billion yen. The results will materialize in 1983. At the present level of
oil prices, the investment amount will be fully recovered."
The problem from now on is to decide wheth2r to make energy conservation investments.
Naturally, the amount is large and the recovery time has lengthened. Unlike the
past, investments cannot be made without awareness of risk. Director Omodaka says:
"So that investments will not become worthless, we must take a very cautious
attitude in the future."
Trend Toward Emphasizing Energy Balance
- There is another example. In steelmaking, over 50 percent of the input energy
escapes in the form of waste heat, so to that extent the amount that can be
- recovered and reused would contribute toenergy savings. Thus, recovery and reuse
of waste heat and gases are being fully carried out.
Recently, however, because of the successful recovery of waste heat, some factories
- are unable to use it all within the same plant. An example is the previously
mentioned Chiba plant of Sumitomo Chimical Co. Unless the use of waste heat is
fully planned, unexpected new problems will arise and of course new energy conser-
vation investments will become difficult and even the effective use of existing
facilities will become impossible.
In other words, the stage has been entered, as Shigetoshi Ishihara, director of
Nippon Steel Corporation, claims, where "energy conservation must be carried out
with consideration for the balanced energy use of the plant." Perhaps this is a
transition from the old headlong save-energy period, when it was appropriate to
economize any and all types of energies, to an energy conservation age with priority
on balanced conservation.
33
- FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
It is difficult to make short-term predictions about the oil market but our indus-
try's consensus, formulated on the basis of recently gathered information, is that
from a long-range viewpoint, oil prices will continue to rise in the future. The~e~
fore, even if the risks are high, the basic policy ot energy conservation and
finding alternate sources to oil will be firmly continued in the future. The
problem is the means of implementation.
An erroneous forecast in the timing of investments and market trends of products
or energy conservation investments which disregard the energy balance of the entire
plant will have negative effects. In other words, the second-phase energy conser-
vation age is one when skill in energy conservation investments will separate the
first-rate from the second-rate in enterprises. To survive the second-phase energy
conservation age, three types of plans were conceived and analyzed.
Second-Phase Energy Conservation Age: Steelmakers Emphasize Ba:lanced Use--If
Reliance on Oil Decreases Excessively, Investments Will Go Down the Drain
"After the first oil shock waste elimination was considered energy conservation,
but now energy conservation must be considered in the light of overall balanced
usage. In fact, it seems that after about 2 years there will be a glut of energy
sources" (statement by director Ishihara).
Although the steel industry is typically a large user of energy, it is said that
there will be an oversupply of energy. Believing that this was a strange develop-
ment, I inquired as to the reasons and was told that measures to conserve energy
and to develop oil alternate sources had been too effective.
Use of Coal, Recovery ~f Waste Heat and Continuous Operation
Accarding to Jiro Shiramatsu, director of Nippon Kokan RK, the energy counter-
measures of steelmakers are confined to three means.
First, conversion to fuel of stable supply, i.e., from oil to coal. On 11 May,
the No 1 blast furnace of Nippon Steel Corporation's Nagoya steel refinery con-
verted from heavy oil, which it had been using, to an all-coke operation. Thus,
all of the 39 operating blast furnaces of the big six steelmakers have changed to
operations without oil. Just recently, Australia raised the price of raw coal
by 32 percent, but still, by calories, raw coal is only about one-thi,rd the cost
of heavy oil. Because of this price difference, Japan's blast furnace operatora
all changed within about 1 and 1/2 years to all-coke operation.
Second, recovery of waste heat and gas. In steel refineries, 45 to 50 percent
of the input energy are used efficiently, but the remainder escapes as waste heat
and gases. Therefore, the blast furnace operators are installing waste heat and
waste gas apparatuses to coke ovens, blast furnaces, steel converters, etc to
promote effective use of energy. The investment returns on recovery equipment
for waste heat and gases get better as energy prices increase, and so they are
coming into widespread use today.
34
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
Third, continuous operation of a plant process. The aim is to save energy and
manpower by simplifying the production process to improve the yield. A typical
example is continuous casting. This is the method by which the melted steel made
in the converter (furnace to turn pig iron into steel) is directly processed into
rolled products such as slabs, billets, etc through continuous casting. In 1972,
prior to the first oil shock, 20 percent or less of Japan's steel was processed
through continuous casting, but today the level is said to surpass 70 percent.
- Because blast furnace operators pusr.ed energy measures, unexpected results appeared.
One is the conversion from heavy oil to coal. This was originally forecast. Aow-
ever, in converting to coal, byproducts such as carbon dioxide gas, hydrogen gas,
etc increase. These gases can be reused as heat sources. This is probably a
happy miscalculation. On the factory level, energy conservation is making substan-
tial gains and energy savings are improving. As a result, the possibility has
arisen that the energy supply might become excessive in the plant.
Let me explain this point further.
Outside Sales Considered Because of No Further Use for Waste Gas
The demand-and-supply balance of energy used in steel plants can be traced in the
following pattern. If waste heat and gas are recovered and reused as energy
~ sources for boilers, the energy supply w311 increase. The all-coke operation
accelerates this process. Since as director Ishihara said, "gas constitutes 30
percent of coal," conversion to an all-coke operation will greatly increase waste
gas as compared to using heavy oil. This provides another source of energy.
At the same time, energy demand is decreasing. Steel demand is also at a standstill
and blast furnaces have curtailed operations. Furthe~more, different makers have
been making various efforts to save energy, particularly with the energy-conserving
continuous casting process, and all have succeeded in conserving energy substan-
tially. To take the example of Nippon Steel Corporation: With the first half of
1973 as the base, it is reported that there was a 13.5-percent energy-saving rate
in the latter half of 1980 (an improvement in the per unit energy consumption).
A cumulative calculation of energy conservation attained by the Nippon Steel
Corporation between 1974 and 1979 reveals savings of 11.17 million kiloliters of
crude oil, and in ship tonnage this will amount to 48 tankers of 20,000-ton capacity.
This might be considered a tremendous achievement for Japan's steel industry,
but ironically, because of this success the demand-and-supply balance of energy
in the plant might swing toward an excess of supply, thus creating a new problem.
"Even if waste heat recovery apparatuses are installed in anticipation of further
price increases, there is no additional use for the recovered heat in the plant.
It will be all right if the surplus energy can be sold to outsiders, but if that
cannot be done, the investments might go down the drain" (statement by Akira Ota,
chief of energy control office, Nippon Kokan KK).
As work operations are stepped up and the amount of coke use increases, it is
claimed that steel plants will be faced with a rather serious problem of surplus
35
FOR OFFIC[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400044052-6
FO~ OFFICIAL USE ONLY
energy. Without exception, of�icials responsible for energy control of blast
fumaces say that, "hereafter, energy conservation investments must be made from
the standpoint of overall balance." It appears that blast furnace operators haVe
progressed from the sim~ple task of energy economy of the past to a new stage.
The activities have already started. The Fukuyama steel plant of Nippon Rokan RK
iG recovering the waste gas from steel converters and is thinking not only of its
internal plant use but outside sales. In partnership with Nippon Sanso KK, Nappon
Kokan KK has started the construction of facilities to separate and manuf.acture
hydrogen and carbon dioxide from the waste gas of converters. The plans are to
spend approximately 4 billion yen and complete the pro~ect in June of next year.
According to the plan, the amount of hydrogen to be generated is 600 "normal"
(normal temperature) cubic meters p~r hour, half of which will be used in the
annealing process of cold-rolled sheets at the Fukuyama plant, while the r~emainder
will be supplied to Nippon Sanso KK. On the other hand, the amount of carbon
dioxide to be generated is 1,000 "nor�nal" cubic meters. Of that amount, 70 percent
will be used at the Fukuyama steel plant and 30 percent will be sold as dry ice
to Nippon Sanso KK.
Since blast furnaces use raw coal, a great amount of waste gas is generated in ~
the coke ovens, blast furnacea, converters, etc. The term "waste gas" should
be noted here. Since the aim of blast furnace operators is to make steel, the
byproduct gas which is generated is "waste gas." flowever, for the coal chemical
industries, the waste gases are raw materials. From the standpoint of chemical
makers, steel might be called the byproduct.
Steel Plants Are Energy Cen.ters
Nippon Kokan KK decided on the new investments because "if waste gas is a surplus
com~odity, why not commercialize it?" Steelmakers, who are large users of energy,
have been transformed, in a way, to energy suppliers.
Since 1967 the Fukuyama steel plant has the record of having supplied urban gas
to Fukuyama city from gas generated in its coke ovens. Furthermore, with the
recent fuel conversion to coal, the steel plant has commercially established a
coal center, using its huge coal storage area and loading facilities, to service
electric powar plants, cement factoriesr etc which do not have coal storage areas.
The steel plant is beginning to play the role of an energy center in the Fukuyama
district.
The Nippon Steel Oita plant, unlike the Nippon Kokan Fukuyama plant, is trying
f or overall energy balance by reducing its energy supply.
One method is pulverized coal in~ection in the No 1 blast furnace. Operation
will start in June of this year. The disadvantage of an all-coke operation is
that productivity is 10 to 20 percent poorer than using heavy oil in~ection.
Furthermore, in changing the production amount, minute adjustments tend to be
difficult because coke is a solid fuel. By contrast, by in~ecting pulverized
coal in blast furnaces, cheaper and more stable operations can be maintained�than
36
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
by using heavy oil or coke. This method decreases the use of coke and corre-
spondingly decreases the amount of waste gas. ~Still more important, if all-coke
operations were to be continued, as the operational load increased, coke ovens
themselves would have to be enlarged and enormous equipment investments would be
required, but this can be avoided.
Of course, energy conservation will remain an important issue for blast furnace
operators in the future. One reason is stated by Ishihara, director of Nippon
Steel Corporation: "Purchases of raw materials and sales of products require
counterparts and cannot be conducted alone, but energy conservation can be accom-
plished independently." Essentially, it means that a new twist must be given to
energy conservation.
Second-Phase Energy Conservation Age: Aggressive Chemical and Textile Industries--
Seeking an Opportunity for "Conversion in Manufacture" During Low Growth Period
Sumitomo Chemical Co Ltd Is Counting on Newest Facilities
Director Ishiwatari of the Sumitomo Chemical Co complains: "It has been a long
time since it was possible to conserve some energy simply through conscientious
efforts. Energy conservation measures are beginning to require more and more
money."
Between 1977 and 1979, the company started an all-out energy conservation program,
and in 3 years it reduced per unit energy consumption by 15 percent, a monetary
saving of 15 billion yen. Through this program, the company says it has exhausted
practically all of the elemental means of conservation.
Since then, however, the company has not stood idly by without conserving energy.
In fact, it is becoming more aggressive. In the words of director Ishiwatari:
"Because of last year's crude oil price increase, the number of cases have increased
where even if sizable capital is required, investments in energy conservation have
proven much more profitable." From 1980 to 1982, the company plans to reduce
energy consumption by another 12 percent, but director Ishiwatari is optimistic
that, "probably, savings will amount to 15 percent."
To do that, he says, "improvements in and rationalization of existing facilities
will be carried on as before, but the decisive factor is the conversion of produc-
tion processes (manufacturing methods)."
Here is a concrete example. This January, the company started operating a new
facility for manufacturing resorcine. Resorcine is a product used as raw material
to make adhesives for tire cords, wood materials, etc. Heretofore, the company
used the sulfonation alkali fusion method in which benzene and propylene were
oxidized with sulfuric acid. (The actual maker is the Taoka ~hemical Industries
Co, an affiliate firm.) The new plant employs the hydroperoxide method which
uses a special catalyst. This is a new processing method with a completely
different reaction principle.
37
FOR OFF[C[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047/02/09: CIA-RDP82-00850R004400040052-6
FOR OFFICIAL USE ONLY
In the new manufacturing method, the processing is continuous, and as compared
with the past method, energy consumption can be greatly reduced. Fuel costs can
be adjusted to production volume. The so-called fluctuating cost system enables
per unit cost to be reduced by half.
Director Ishiwatari points out: Many of the existing plants have been designed
with cheap energy as a precondition." If manufacturing processes based on new
designs aimed at energy conservation are introduced, it is possible to achieve
savings of such large proportions that they cannot be compared with the usual
energy economy cut.
That is probably the reason why, although the company has exhausted Che elemental
energy saving means, it is eager to embark on fundamental energy conservation
measures.
Confusion Over Uncertain Outlook for Demand ~
Actually, even in the case of Sumitomo Chemical Co, large-scale conversion of
- manufacturing processes could not be carried out simply from the standpoint of
energy conservation. Normally, when facilities are "scrapped and rebuilt," produc-
tion capacity is increased. The outlook for dema.nd-and-supply cannot be ignored.
Director Ishiwatari says: "Conversion of manufacturing methods during a low growth
period is a very difficult decision."
In reality, the company's resorcine production capacity, which had been 1,500 tons
yearly in the past, increased to 5,000 tons annually with the completion of the
new plant. By chance, since there are few overseas rival resorcine makers, the
increased production amount could be earmarked for export. Therefore, things
went smoothly, but without export prospects new plant investments would be difficult
to make simply for the sake of en~rgy conservation. As compared Yai.th the past,
the relationship between energy conservation measures and overall plant management
is getting much closer.
Such cases have already appeared.
Sumitomo Chemical Co has established a processing method whereby steam required
in propylene manufacture can be reduced to one-fourth the previous requirement.
The company has already agreed to technical export of the process to overseas
makers. It has also decided to employ the process at the Singapore petrochemical
pro~ect (Sumitomo will participate in the merger company) and construction is in
progress.
This is known as the bulk process (BPP). In this process, solvent which was
indispensable in past methods need not be used, and so the attractive feature
is that the solvent recovery process can be eliminated.
However, for the time being, the company has no plans to convert its propylene

-i plant to this advantageous BPP process. Strictly from an energy conservation
viewpoint, this seems to be an odd decision. But when the outlook for propylene
demand is not considered bright, the risks were considered too high, from an
_ 38
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
overall management viewpoint, to invest a huge amount of money at this time in
propylene facilities, so an opportune time is being awaited.
"Differential Profits" Give Confidence to Showa Denko KK '
Showa Denko KK is also faced with similar issues. The problem is whether or not
to "scrap and build" the naphtha fractionating apparatus which might be said to
be the hub in ethylene manufacture. The naphtha fractionating process accounts
for nearly 40 percent of the energy consumption of the entire petrochemical indus-
try. The extent of energy conservation which can be carried out in this field
exerts great influence or. operations of chemical companies. Through technological
renovations or new concepts about the use of facilities, the important energy con-
sumption of ethylene plants can be greatly altered.
According to a survey by the Japan Development Bank, ethylene plants presently
operating in Japan use an average of 10 million kilocalories of energy to produce
- 1 ton of ethylene. In modern plants, the consumption drops to 7 million kilo-
calories. If the yearly production is 300,000 tons, this difference would mean a
cost reduction of about 4.5 billion yen. It is certain that this would be a big
boost to increased prof its.
Showa Denko KK has two ethylene units in the Oita plant. Unit No 2 started
operating in 1977 and is Japan's most modern. The Japan Develo.pment Bank comments:
"One of the reasons for the company's fine business record is the high efficiency
of the new plant." But the company has no plans at present to "scrap and build"
unit No 1(operation started in 1969). Because of decreased demand, unit No 1
has suspended operations for about a year and the company finds it difficult to
carry out plant construction which will contribute directly to expanded capacity.
Other reasons given are the uncertainty of obtaining raw materials and the lack
of company reserves to invest in a unit which costs 50 billion yen. This case
also reveals that in the present stage of energy conservation, consideration must
be given to the overall company management.
Of course, Showa Denko also has the basic understanding that, "energy conservation
is an aggressive management tool." As Kenichi Watanabe, director, expressed the
attitude: "Thinking should not be limited simply to saving energy. To survive,
cost-cutting measures must be devised by aggressively promoting technological
developments and plant investments for energy conservation." He recognizes that:
"Operations of chemical firms are centered on equipment, and for suY,stantial energy
conservation the equipment must be changed." Showa Denko KK thinks along the lines
of Sumitomo Chemical Co.
In the case of Showa Denko KK, there is the following concrete example.
The additive ferrochrome is used in the manufacture of special steels, such as
stainless steel. The company developed a new process for manufacturing ferrochrome
called the SRC [solid chrome ore recovery processJ. Ore to be used as raw material
is given special preparatory treatment, and although heretofore all ore was refined
in electric ovens, this method makes it possible to process some of the ore in
cheaper oil-burning ovens.
39
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAI. USE ONLY
In the previous method, 4,000 kilowatts of electricity were needed to produce 1
ton of ferrochrome, but with the SRC process only 2,000 kilowatts, or exactly
h~lf, are required. Monetarilp, this is a saving of 17,500 yen. After subtraCting
8,000 yen for heavy oil used in the special SRC process ovens, there is still a
cost reduction of 9,500 yen. Furthermore, since late last year, the process has
been altered so that coal can be used in place of heavy oil. The cost of coal,
per ton of ferrochrome, is 5,500 yen, which is even cheaper than heavy oil. Thus,
the comparative difference in cost is 12,000 yen. Since the company produces
about 80,000 tons of ferrochrome annually, nearly 1 billion yen in "differential
profits" can be realized through this process alone. This amount eannot be ignored
since the company profits, after taxes, amounted to 7.5 billion yen plus last year
over a 12 month period. This is a model case of using energy conservation as a
management tool.
"Energy Conservation Setup" Organized by Toray Industries Inc
On 1 June 1981, Toray Industries Inc installed a new unit called the energy tech-
nology room. Its goals are to gather and analyze technological information per-
taining to energy conservation, develop new technologies and to promote energy
conservation in various plants of the company. In other words, it is the "energy
conservation implementation group." Of course, the company has promoted energy
conservation activities of various types. During the past 5 years, as Kinzo
Kitamura, director, states: The energy required to produce the same product has
decreased 30 percent, resulting in the saving of several tens of billions of yen.
If we had not achieved this saving, recent company profits would have been prac-
tically nullif ied."
What is the aim of a company with such a record to establish a new unit to cope
directly with energy conservation at this time? Let us ask director Kitamura.
"The crude oil supply seems to have stabilized for the immediate future, but the
energy conservation investments made till now are not sufficient to cope fully
with the rising crude oil prices. There are sti11 many steps to be taken. The
problem is that it has become difficult to conserve energy by aimply relying, as
in the past, on spot investments for improvements accidentally diseovered at the
production sites. Therefore, we have gathered experts and are trying to devise
aggressive actions which differ from previous operational concepts."
Concretely, the aim is to improve the production processes. For example. if
steam is used as the heat source, the process can be changed to the use of heat
directly from the boilers and the steam-making process can be eliminated. Also,
the production system can be controlled through use of microcomputers.
A successful example of the company's energy conservation program can be seen in
the Ishikawa plant. Ideas for the energy technology room emanate from here.
~ Some explanation is in order here.
The company employs a spinning process called the POY (pre-oriented yarn) system.
The system sounds somewhat complfcated but it is a new process to shorten the
existing steps: 1) spinning (to make fiber); 2) drawing out (to stretch fiber);
. l~0
~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FUR OFFIC7AL USE ONLY
and 3) winding (to twist fiber). In the first process, the spinning apeed can be
increased from the previous 1,000 meters to 3,000 meters per minute. Through the
increased speed, it has become possible to simultaneously accomplish the task of
arranging the fiber elements in parallel direction, which is the ob~ective of the
drawing out process. As a result, the drawing out process was eliminated and the
energy required in temperature control for drawing out became unnecessary. The
company's commodity prices are cheaper than those of Western countries which use
cheap energy and the company is strong competitively. It is said that the POY
system is a big contributing factor.
Having achieved this success, the company's policy, according to director Kitamura,
is "to vigorously carry out energy conservation activities of a higher level and
- not succumb to an optimistic mood that crude oil will be available for the imme-
diate future." These cases prove that although the oil situation has improved
greatly, the basic course is to conserve energy innovatively through introduction
of new production methods.
Second-Phase Energy Conservation Age: Paper Mills and Electric Power Companies
Depend on Diversification--Prepare for "Crisis" and Avoid One-Sided Existence
Figure 2. Plan of O~i Paper Co To Prepare for Unexpected Situations Through
Energy Source Diversification (Composition Ratio of Energy Sources)
In-house
power
generation
In-hou~e Purchased
po,rer elec+.ric
~eneration power
i~*" _ i
ftzrchased _ Heavy ~ / ~ ~
e~~ctric ~ oil ,i ~~~~u \ ~Hea~y
F ~ , ;r. ~ ~ / '3.7 ; , ~
ower _ ~ oi].
.
';1.~ F, / =$1~~e"~ I " ~
. s I ' ~ s ~ ;G ~ \
Blac:: ~ iqu ~id ~ ~
(use waste \ : - ~9a3 a2(,~~ t .
Z1.C~~11~~ ~ ~ ~ 1~78 , ~ 58%~r,. ~
g3' . ,6i;�', i 1 ~$f~'~O ` 1
i 7~~ � ~ I Pla.ri
m EI).~i. j:
/ ` j \ti.�.. 2~ ~ ~4` ~f.~
~ . ~
; - / , , I `'^I 15
Black i a ~k ~ , -r , ? ~
~ 1; ~ Co~.l
~
~ iquid ~ o a i:. ~
~waste 'rlaste ~Ba.rk
liquid tire
use)
41
FOR OFFIC[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USE ONLY
Oji Paper Co Ltc: Even Uses "Waste Products"
~lease note the chart on the preceding page. It shows how energy sources to be
used within the Oji paper plant will alter between 1978 and 1983 (plan). It is
immediately evident that coal, which was not used at all in 1978, will become an
important energy source in 1983, while heavy oi1, which was a ma~or source, will
drop below 50 percent in the fuel composition ratio.
Of course, this is the company's response to heavy oil price increases, as stated
by director Omodaka: "At any rate, we must lessen our reliance on heavy oil."
First, the heavy oil boilers of Tomakomai plant were converted to coal burners,
and the fuel for other boilers is being changed to coal.
As compared with 1978, by 1980, the company had already reduced by 28 percent the
amount of heavy oil used in producirig the same amount of paper pulp products. The
plans are to achieve a 52-percent reduction in 1983, as com~pared with 1978.
These developments, however, are not simply a matter of fuel conversion to coal.
That would only be conversion from the higher priced heavy oil to the relatively
cheap coal. A closer examination shows that the plan is not such a simple one.
In the 1983 plan, heavy oil and coal together account for 47 percent plus, or less
than half, of the ratio of the entire energy consumption. In 1978, heavy oi1
alone accounted for 65 percent of the entire ratio, so the situation is going to
change considerably.
a Diversification of energy sources is the key to solving~this statistical puzzle.
The company has clearly indicated that it wants to rely more on the use of "black
liquid" (waste liquid left after extracting pulp from raw chips) and on electric
power. Although of lesser value, the use of tree bark and waste tires is contem-
plated, and the plan is for a balanced use of resources.
Naturally, the foremost reason is the cost difference. Since the "black liquid"
is a waste product, it can become a cheap energy source,by installing recovery
boilers. The company has made progress in the use of "black liquid" and there
are few technical problems left. The same can be said for the use of bark and
tires.
Transfer to Alternate Energy Source While Pushing Conservation
The other reason Oji Paper Co made plans for energy diversification ia that, as
director Omodaka states, "it is difficult to accurately predict the future of the
energy situation." Ttie company wants to avoid reliance on fixed energy sources.
For example, coal prices are relatively cheap now, but as consumpCion rapidly
~ increases there is no assurance that for some reason there might not be changes
in the price and supply of coal. If such is the case, it is advantageous to plan
for diversification of risks. It might be termed an "energy portfolio" atrategy.
To simply decrease oil consumption is an ebsolete measure.
Then, what will actually happen if energy sources are diversified? In daily
operationa, a balanced use of resources will probably contribute, in general,
1~2
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007142/09: CIA-RDP82-40854R040400040052-6
FOR OFFICIAL USE ONLY
to energy conservation. At the company's Tomakomai plant, where energy source
~ diversification is most advanced, a computer control system for energy sources
- wi11 be installed in April of next year. The aim is to use the computer to
formulate the most appropriate ratio for use of coal, heavy oil, "black liquid,"
hydroelectric power, etc.
As energy-saving measures, the company is working simultaneously on transition to
oil-alternate sources and energy conservation. Energy conservation is proceeding
smoothly, and it is forecast that in 1981 there will be a 22-percent reduction
in energy use to produce the same amount of products as in 1978. Except for old
paper and ink, the biggest gains in energy consercation investments were in the
installation of the dinking process used to recycle chips, waste heat recovery
boilers, continuous process equipment which changed paper bleaching from dispersed
to continuous operations, etc.
However, close examination of energy conservation efforts reveals that, as compared
with the previous year, the per unit energy reduction rate was 9.2 percent for
1979, 8.9 percent for 1980, and 5.6 percent (projected) for 1981--it is gradually
. slowing down. According to director Omodaka, it appears that "for 1982-1983, a
5 percent reduction is the maximum." This is a natural course, but because
investments were made on items with the highest returns, energy conservation
means are becoming difficult to find.
The timespan between energy conservation investment and energy cost reduction, in
other words the investment return period, was said by the company to be 2 to 3
years. Itecently, it seems that this period is lengthening to 5 to 8 years. Since
crude oil prices are not increasing at the previous rapid rate, the possibility
has arisen that money spent on energy conservation investments might be wasted.
The company has to be much more cautious than before in making investment decisions.
The "energy portfolio" is a concrete manifestation.
Balance the Various Energy Sources
With the aim of energy cost reduction, electric power industries are also placing
great efforts on large-scale energy source diversification.
As shown in the table on the following page, plans are underway to reduce reliance
on oil thermal power plants, which occupied 42.5 percent of Japan's electric power
sources in 1980, tn about half in 10 years and to place it on equal footing with
atomic, hydroelectric, coal, LNG and LPG power plants. Following the pattern of
the past conversion from coal to oil, electric power circles label the present
energy source conversion the "Second-Phase Energy Revolution" (words of Gaishi
Hiraiwa, president of Tokyo Electric Power Co Inc) to emphasize the efforts they
plan to put into the program.
43
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6
FOR OFFICIAL USF ONLY
Figure 3. Emphasis on Balanced Use of Energy Sources by Electric Power Companies
(Japan's Power Generating Facilities by Types of Energy Sources)
, - ;
. i -
,?2.0) ~i:
?C~=f:53c��i F~ .
~
(10 million r~
kiloWatt ) - - .Y~,
. _ ;..p '
- .~.t ,
(:l S.Bk'S ,
15 . . . . . _ +t
: . � -'ti;~~'~~4 Key :
~1~ ~ ;';.z~~~` (tz:~1~.`
V.~ . a 1. Atomic pow~er
r .;:~,.j . _ , 2. Hydroelectric power
i ;,~~~}'�r~' : 3. Coal power
(2 ~ , c ~3:0)~` t' ' ' 'r 4 . LNG, LPG power
(3~ '�_~y~;:~;-~~~ ~ ~`i'~~~~~ 5. Other types of power
' f~ ` 6 . Oil power
(4 ) ~ w~ ~~~~:r
~ i rv~f`.t~!'1~7T` - '
J,..
~5) I 'c,.s}.;;~' i. :;~y
6~ �a>~~::hn' (2is)~`'.
( ` ~42.57~;~y, k
~ ~ ':,Y~~"
l~i , , '.~,�.PO.: 1. .._~�i'n~~1~~. .
~5`kf~ 1980 65!dt~E~)
;c ' i ~ frl'�tl~F�.i2~.~ �0 1990 (plan)
Note~ Parenthetica.l figurea
show compo~ition
ratio in percent
The total cost of oil power generation, which is currently the most popular, is
17 to 18 yen per kilowatt-hour. Atomic power costs 8 to 9 yen. Oil is the most
expensive as compared with other energy sources. Furthermore, because of the
influence of OPEC, the supply of oil is the most unstable. In view of these
factors, it is only natural that electric power circles should try to diversify
energy sources.
Electric power industries are not simply interested in finding alternate sources
to replace oil. They are emphasizing the concept of an "energy portfolio" which
places priority on the balanced use of various energy sources. The cost of atomic
power is cheap, but because of the concern over its safety, there are difficulties
_ in locating plant sites, unexpected operational stoppages occur, etc. As for
coal, LNG and LPG, there are uncertain factors about changes in their future
prices, supply, maintenance of transportation routes, etc. Each of the energy
sourcea has ~�rtain weak points.
44
, VLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6

APPROVED FOR RELEASE: 2047102109: CIA-RDP82-00850R400404040052-6
FOR OFFICIAL USE ONLY
For these reasons, the power plants to be constructed are naturally limited, as
a rule, to other than oil-burning plants, and existing oil power plants are being
converted, one after the other, at enormous expense, to coal and LNG power plants.
Examples are the Himeji plant of Kansai Electric Power Co Inc, the Shin Ube plant
of Chugoku Electric Power Co Inc, the Mizushishima plant (still under negotiations)
of the same company, and the Sai~o plant of Shikoku Electric Power Co Inc. Also,
the Higashi Niigata plant of Tohoku Electric Power Co Inc arranged to receive
power from Tokyo Electric Power Co, and while delaying operations for about 2
years, facilities will be altered and the originally planned oil power plant will
be converted to an LNG plant. The Tatsushima plant of Chugoku Electric Power Co
Inc had planned for combined use of oil and LPG, but decided to change to oil only
[as published], and the company will probably enter into negc?tiations with local
residents. It is becoming abundantly clear that heavy priority is being placed
on balanced energy use.
COPYRIGHT: Nikkei-McGraw-Hill Inc 1981
9134
CSO: 4105/198 IND
45
FOR OFFIC[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000400040052-6