As China and Russia increase their energy cooperation, Russian gas giant Gazprom and China National Petroleum Corporation (CNPC) have inked a new agreement under which Gazprom would deliver natural gas to China via the Far Eastern route.
Gazprom and CNPC have agreed to a long-term Sales and Purchase Agreement for natural gas to be delivered via the Far Eastern route, increasing Russian gas supply to China by 10 billion cubic metres per year.
“The signing of this document is an important step towards further strengthening the mutually beneficial cooperation between Russia and China in the gas sector,” said Gazprom, which expects total Russian pipeline gas supply to China to reach 48 billion cubic meters per year, including deliveries via the Power of Siberia gas trunk line.
An industry source in Beijing told Reuters that the agreement for the new pipeline, which is anticipated to be operational in three years, will be settled in euros. The Power of Siberia pipeline, which began operations at the end of 2019, is already transporting natural gas from Russia to China.
Commenting on the deal announced on Friday, the CEO of Gazprom, Alexey Miller said: “This is already a second contract to be signed for Russian gas supplies to China, and it is indicative of the exceptionally strong mutual trust and partnership between our countries and companies. Our Chinese partners from CNPC have already seen for themselves that Gazprom is a reliable gas supplier.”
While Russia is strengthening connections with China in the energy sector, it remains at war with the West over Ukraine, and Gazprom’s gas supplies to Europe have fallen in recent months. Despite record-high natural gas output, Russia has not exceeded its contractual obligations to Europe in the current winter season.
%20have%20inked%20a%20new%20agreement%20under%20which%20Gazprom%20would%20deliver%20natural%20gas%20to%20China%20via%20the%20Far%20Eastern%20route.Gazprom%20and%20CNPC%20have%20agreed%20to%20a%20long-term%20Sales%20and%20Purchase%20Agreement%20for%20natural%20gas%20to%20be%20delivered%20via%20the%20Far%20Eastern%20route,%20increasing%20Russian%20gas%20supply%20to%20China%20by%2010%20billion%20cubic%20metres%20per%20year.“The%20signing%20of%20this%20document%20is%20an%20important%20step%20towards%20further%20strengthening%20the%20mutually%20beneficial%20cooperation%20between%20Russia%20and%20China%20in%20the%20gas%20sector,”%20said%20Gazprom,%20which%20expects%20total%20Russian%20pipeline%20gas%20supply%20to%20China%20to%20reach%2048%20billion%20cubic%20meters%20per%20year,%20including%20deliveries%20via%20the%20Power%20of%20Siberia%20gas%20trunk%20line.An%20industry%20source%20in%20Beijing%20told%20Reuters%20that%20the%20agreement%20for%20the%20new%20pipeline,%20which%20is%20anticipated%20to%20be%20operational%20in%20three%20years,%20will%20be%20settled%20in%20euros.%20The%20Power%20of%20Siberia%20pipeline,%20which%20began%20operations%20at%20the%20end%20of%202019,%20is%20already%20transporting%20natural%20gas%20from%20Russia%20to%20China.Commenting%20on%20the%20deal%20announced%20on%20Friday,%20the%20CEO%20of%20Gazprom,%20Alexey%20Miller%20said:%20“This%20is%20already%20a%20second%20contract%20to%20be%20signed%20for%20Russian%20gas%20supplies%20to%20China,%20and%20it%20is%20indicative%20of%20the%20exceptionally%20strong%20mutual%20trust%20and%20partnership%20between%20our%20countries%20and%20companies.%20Our%20Chinese%20partners%20from%20CNPC%20have%20already%20seen%20for%20themselves%20that%20Gazprom%20is%20a%20reliable%20gas%20supplier.”While%20Russia%20is%20strengthening%20connections%20with%20China%20in%20the%20energy%20sector,%20it%20remains%20at%20war%20with%20the%20West%20over%20Ukraine,%20and%20Gazprom's%20gas%20supplies%20to%20Europe%20have%20fallen%20in%20recent%20months.%20Despite%20record-high%20natural%20gas%20output,%20Russia%20has%20not%20exceeded%20its%20contractual%20obligations%20to%20Europe%20in%20the%20current%20winter%20season.){kind=link}