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UPDATE 1-Olympics-IOC urges Tokyo to keep costs below $20 billion

* IOC believe budget cap remains too high

* Four-party working group set up to study costs (Adds quotes, details)

By Elaine Lies

TOKYO, Nov 29 The International Olympic Committee (IOC) has urged Tokyo to keep costs for the 2020 Summer Games below $20 billion as the hosts continue to grapple with ballooning expenses for the multi-sports event.

Tokyo governor Yuriko Koike ordered a review of the budget that recommended revised plans for three venues to trim costs projected to hit 3 trillion yen ($26.75 billion), four times the initial estimates made when Tokyo won the rights for the Games.

At an open meeting for a four-party working group that includes the IOC on Tuesday, Tokyo 2020 organisers vowed to keep costs below $20 billion but the Olympic authority felt even that ceiling was too high.

"The IOC has not agreed to that amount of money," IOC Vice President Peter Coates told reporters after the meeting, the culmination of a month of technical talks and lower level working group gatherings.

"We believe the Games can be delivered for significantly less than that," he said, noting that the IOC would sit down with Tokyo officials to discuss further cuts.

Among proposals discussed were those made by the Tokyo government to move rowing and canoe/kayak sprint events to an existing course 400 km (250 miles) north of Tokyo, and using older facilities in the capital for volleyball and swimming.

Koike, who became governor in August, told the meeting that due to the high cost of refurbishing the existing rowing venue, Tokyo had decided to stick with plans to build a new one in the capital.

ATHLETES ARE PRIORITY

Costs for a brand new aquatics centre will be pared by cutting the number of seats.

As for volleyball, she proposed using an existing venue in the neighbouring city of Yokohama and asked to have until Christmas to make a final decision -- a request to which the group agreed.

Last month, IOC President Thomas Bach said that while the Olympic authority was concerned about rising costs for the Tokyo Games, the experience of the athletes had to remain a priority for any planning.

Costs for many venues have soared since Tokyo beat Madrid and Istanbul for the right to host the Games in 2013, which organisers blame on increased construction costs following the March 11, 2011 earthquake and tsunami disaster.

IOC reforms known as "Agenda 2020," carried out with the aim of keeping the Olympics more sustainable, urge the use of existing facilities when possible -- even in other cities or countries -- if it makes financial and practical sense.

Games organisers have run into a series of broken promises and problems in their preparations, including scrapping the original design for the centrepiece National Stadium as well as the first logo after allegations that it was plagiarised.

($1 = 112.1700 yen) (Reporting by Elaine Lies; Editing by John O'Brien)

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