Russia and China address gas supply via the western route

Beijing hosted meetings of Alexey Miller, Chairman of the Gazprom Management Committee with Zhang Gaoli, First Vice Premier of the State Council of the People’s Republic of China as well as with Wang Yilin, Chairman of the Board of Directors of China National Petroleum Corporation (CNPC).

The parties appreciated the progress with the project for Russian gas supply to China via the eastern route. The work at the Russian section is running on schedule. It was highlighted that the previous week the gas pipeline for receiving gas from Russia had entered the construction phase in China and its first joint was to be welded in late June.

The meeting participants gave a thorough consideration to the ongoing negotiations on gas supply to China via the western route and a schedule of further steps preceding the contract signing.

As Alexey Miller noted at the end of the talks, “the inked contract on the eastern route has created a solid foundation. Our talks on the western route are advancing at a good pace. The signing of the Heads of Agreement for the western route was a milestone event. Upon setting the border crossing points, we have ultimately and completely chosen a supply corridor both for the first 30 billion m3 of gas from Western Siberia and for further supplies.”

Background

State-owned petroleum company CNPC is one of the largest integrated companies in the world.

The eastern route stipulates gas supply from the Yakutia and Irkutsk gas production centres to China via the Power of Siberia gas trunkline.

On 21 May, 2014, Gazprom and CNPC signed the Purchase and Sale Agreement for the Russian gas supply via the eastern route. The 30 year contract provides for Russian gas supplies to China in the amount of 38 billion m3/yr.

The western route envisages gas supply to China from Western Siberia’s fields in the amount of 30 billion m3/yr.

On 8 May, 2015 Gazprom and CNPC inked the Heads of Agreement for pipeline gas supply from Russia to China via the western route.


Adapted from press release by Hannah Priestley-Eaton

Published on 03/06/2015


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