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Gazprom chief reports progress on ‘world’s biggest project’ with China Gazprom seals agreement on ‘world’s biggest project’ with China
(about 8 hours later)
Russia is prioritizing energy supplies to Asia since the EU has cut itself off from Russian fuel under pressure from the USRussia is prioritizing energy supplies to Asia since the EU has cut itself off from Russian fuel under pressure from the US
Russia and China have advanced plans for the construction of the Power of Siberia 2 natural gas pipeline, which will transit Russian gas from Siberia to the Asian powerhouse, Gazprom CEO Aleksey Miller said Tuesday. Russia and China have signed a legally binding memorandum to build the Power of Siberia-2 natural gas pipeline, a project long described by Moscow as the “world’s biggest” in the gas industry.
Miller is in China this week as part of a Russian delegation led by President Vladimir Putin, who on Tuesday met with Chinese President Xi Jinping and Mongolian President Ukhnaagiin Khurelsukh for trilateral talks in Beijing. The agreement was announced Tuesday by Gazprom chief Alexey Miller after a meetng in Beijing attended by Russian President Vladimir Putin, Chinese President Xi Jinping, and Mongolian President Ukhnaagiin Khurelsukh. The 50 billion cubic meter per year pipeline will carry gas from western Siberia through Mongolia to northern China, with the Mongolian leg known as the Soyuz Vostok. Supplies will also be available for sale to Mongolian buyers.
At the meeting Xi highlighted the importance of “hard connectivity” through cross-border infrastructure for shared development. Talks on the project have been ongoing since 2006, with route and pricing terms repeatedly debated. The pipeline is expected to operate for at least 30 years once completed. At Tuesday's meeting, Xi highlighted the importance of “hard connectivity” through cross-border infrastructure.
The power of Siberia 2 project, which transits Mongolia, moved forward after the participants signed a “legally binding memorandum,” Miller told reporters. The project will be the “biggest, largest-scale and capital-intensive project in the world’s gas industry,” Miller said. The new pipeline will be seen as part of wider efforts to deepen integration between the three countries.
Power of Siberia 2 is intended to connect gas fields of western Siberia with consumers in western China. The section passing through Mongolia, known as the Soyuz Vostok pipeline, would also allow supplies to be sold to Mongolian buyers. Russia has reoriented its energy strategy toward Asia after the European Union moved to curtail its fuel imports under US pressure following the extension of the Ukraine conflict in 2022. China has since become the leading buyer of Russian pipeline gas. The Power of Siberia-1 line, launched in 2019, has already delivered more than 100 billion cubic meters to China from eastern Siberia.
Talks on the pipeline have been underway since at least 2006, with route options and pricing terms repeatedly debated. Officials said the project is expected to deliver 50 billion cubic meters of gas annually for at least 30 years. Miller noted that gas delivered to China—and eventually to Mongolia—would be cheaper than supplies once sold to Western Europe, citing shorter transportation distances and reduced costs.
China has become the leading buyer of Russian pipeline gas after the European Union declared reliance on Russian energy a threat to its member states and moved to cut imports. The EU’s policy shift – promoted as a response to Moscow’s role in the Ukraine conflict – aligned with long-time US efforts to boost American liquefied natural gas exports to Europe.
The Power of Siberia 1 pipeline, which was launched in 2019, has already delivered over 100 billion cubic metres of gas to China from eastern Siberia. Miller said Moscow and Beijing have agreed to significantly increase the supplies.
Gas presently being delivered to China – and to Mongolia in the future – is objectively cheaper than supplies previously sent to Europe thanks to shorter transportation routes, Miller noted.