5/23/2014
SHANGHAI – Russia’s Gazprom and China National Petroleum Corporation (CNPC) signed a historic gas deal on Wednesday during Russian President Vladimir Putin’s visit to Shanghai, media reports said.
Gazprom and CNPC executives signed the agreement in the presence of Putin and his Chinese counterpart, Xi Jinping, after nearly a decade of negotiations, China’s official Xinhua news agency reported.
The 30-year agreement calls for Gazprom to supply 38 billion cubic meters annually of natural gas to the world’s second-largest economy starting in 2018.
China consumed 170 billion cubic meters of natural gas in 2013, with most of the fuel coming from central Asia.
The financial terms of the deal have not been disclosed, but it is estimated that the agreement is worth around $400 billion.
Gazprom, according to experts, was looking to get $400 per 1,000 cubic meters of natural gas, using its contracts with the European Union as the benchmark, while China offered between $350 and $360 per 1,000 cubic meters of the fuel, using its imports from central Asia as the pricing point.
Under the terms of a memorandum signed by Beijing and Moscow in March 2013, Russia will supply Siberian gas to China via the Force of Siberia pipeline.
The pipeline in eastern Russia is currently used to export petroleum to the industrial centers in northeast China.
The gas deal boosts Russia’s efforts to diversify its energy exports as it deals with the economic sanctions imposed by the United States and Europe over its role in the crisis in Ukraine.
source
SHANGHAI – Russia’s Gazprom and China National Petroleum Corporation (CNPC) signed a historic gas deal on Wednesday during Russian President Vladimir Putin’s visit to Shanghai, media reports said.Gazprom and CNPC executives signed the agreement in the presence of Putin and his Chinese counterpart, Xi Jinping, after nearly a decade of negotiations, China’s official Xinhua news agency reported.
The 30-year agreement calls for Gazprom to supply 38 billion cubic meters annually of natural gas to the world’s second-largest economy starting in 2018.
China consumed 170 billion cubic meters of natural gas in 2013, with most of the fuel coming from central Asia.
The financial terms of the deal have not been disclosed, but it is estimated that the agreement is worth around $400 billion.
Gazprom, according to experts, was looking to get $400 per 1,000 cubic meters of natural gas, using its contracts with the European Union as the benchmark, while China offered between $350 and $360 per 1,000 cubic meters of the fuel, using its imports from central Asia as the pricing point.
Under the terms of a memorandum signed by Beijing and Moscow in March 2013, Russia will supply Siberian gas to China via the Force of Siberia pipeline.
The pipeline in eastern Russia is currently used to export petroleum to the industrial centers in northeast China.
The gas deal boosts Russia’s efforts to diversify its energy exports as it deals with the economic sanctions imposed by the United States and Europe over its role in the crisis in Ukraine.
source
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