The Japanese and US governments signed Saturday a statement of intent to work together to develop methane hydrate production.

The agreement was signed by US Energy Secretary Samuel Bodman and Japan's Minister of Economy, Trade and Industry, Akira Amari, ahead of a G8 energy ministerial meeting in Aomori City, northern Japan.

Methane hydrate, or methane gas trapped in frozen water, looks like ice but burns. Its deposits can be found in permafrost regions and seabeds.

According to the agreement effective for three years, Japan and the United States will enhance the understanding of, and accelerate research into, the geologic occurrence, distribution, exploration and production of methane hydrates.

The two sides agreed to exchange scientific personnel and technical information, and have extensive research with respect to methane hydrate exploration and resource assessment.

"To establish technology for commercial production, we have to conduct test-production for several months," a Japanese ministry official said.

Japan already carried out test-production for several consecutive days in Canada, but it needs to carry out on-shore production for a longer test period, he said.

The world is estimated to contain huge reserves of methane hydrates, a potential source of unconventional gas, but one which has not yet been tapped by any country.

Gas hydrates, ice-like deposits of water and natural gas, are located deep underwater where cold temperatures and extreme pressure causes natural gas to condense into semi-solid form.