The gas pipeline, which in the future could provide China, with an additional 50 billion m in six gas a year by Mongolia from the arctic gas deposits on Jamale, gives the world’s largest energy consumer greater possibilities of protecting against future addiction to American liquefied natural gas.
The head of Gazprom announces the signing of a binding memorandum
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As reported by the Reuters agency, the announcement by the President of Gazprom Alexei Miller “legally binding the Memorandum” regarding the construction of the gas pipeline Siberia 2 occurred after the leader of China Xi Jinping, Russian president Vladimir Putin and the president of India Narendra Modi smiled and hugged their hands in China, as well XI-Putin in Beijing and a three-sided meeting with the leader of Mongolia.
Miller said that an agreement was reached on increasing supplies with existing gas pipeline Siberia, running from Eastern Siberia to China, from 38 billion m six. up to 44 billion m six. annually.
However, the price of gas supplied with a new gas pipeline – one of the key factors to understand the costs of building the gas pipeline and the manner in which these costs will be divided between the parties involved – will be agreed separately.
– Announcements regarding the strength of Siberia 2 are a huge turning point in energy geopolitics – said Michal Meidan, Director of China’s energy research at the Oxford Institute for Energy Studies.
– The message is this: China no longer pretends to follow the US sanctions or care about the opinion of the West. And they are not lonely in this.
China is based on Western pressure so as not to trade with Russia
China, which recently received LNG charges from the sanctions of the Russian LNG 2 project, show that they are able to resist Western pressure to isolate Moscow, but the lack of progress in terms of prices indicates that they also demand significant discounts from Russia.
As noted by the Reuters, Putin and XI agency, who opposed the perceived humiliation of the collapse of the Soviet Union in 1991 and the centuries of European colonial domination of China, claim that the world is entering a new era in which the West is falling.
The so -called partnership “without restrictions” between China and Russia, the largest producer of natural raw materials in the world, has strengthened since the West imposed sanctions on Russia for the war in Ukraine.
Russia with China compensates for the loss of Europe
Since the loss of a lucrative piece of the European gas market, Russia has turned to China. Gazprom has been seeking an agreement on the gas pipeline for years Siberia 2.
– The great contract has finally begun – said Kirył Babajew, head of the China Institute and modern Asia in Moscow, a Think Tank advising the Russian government on China. – Although we do not know the parameters of the price and the volume, nor the subcontractors of the pipeline, political negotiations have come to an end and give way to commercial tasks, which will certainly bring results thanks to the blessing of three Russian, Mongolia and China leaders.
There are many unclear: no prices, construction or schedule were announced – And at least one of the leading Russian energy directors believe that China is striving for energy independence thanks to extensive projects in the field of renewable and nuclear energy.
The price, as Miller said, will be lower than the price offered by Gazprom to the recipients due to the huge distances and the area where the pipelines were to be built.
The Kremlin announced that 2 was signed during conversations with China2 contractsincluding a strategic cooperation agreement between Gazprom and China National Petroleum Corporation, but did not provide any details. Same China.
According to Miller, the construction of a gas pipeline from vast deposits of gas Banowankowo and Charasaw in northern Russia, through the wilderness of Siberia, to Mongolia, and then to China, would be the largest and most capital -intensive gas project in the world.
China is Russia’s greatest trading partner
According to the Kremlin’s data, China is Russia’s largest trading partner, the largest recipient of Russian oil and gas, the second largest buyer of Russian coal and the third largest buyer of the Russian LNG.
Gazprom provides natural gas to China with a 3000 km long pipeline called Siberia’s strength under a 30-year agreement with a value of $ 400 billion, concluded at the end of 2019. It is expected that the delivery is expected to achieve a planned bandwidth of $ 38 billion in six. this year.
Miller added that there was also an agreement on increasing the amount of gas bought by China with a pipeline from the Sakhalin island in the Russian Far East to 12 billion m six. annually from an earlier contract for 10 billion m six.
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