On September 2, it was officially announced that Russian dictator Vladimir Putin and Chinese President Xi Jinping had signed a major agreement to build the new Power of Siberia 2 gas pipeline.
Points of attention
- Russia views the agreement as a political victory, as it expands gas supplies to China through multiple routes, aiming to compensate for the decline in supplies to Europe.
- Despite the stalled discussions in the past, the new pipeline project signifies a crucial step forward in Russia-China energy relations, although China remains cautious due to concerns over reliance on a single supplier.
New Russia-China agreement — first details
Russian monopolist Gazprom has confirmed that a legally binding agreement has already been signed to build the Power of Siberia 2 gas pipeline to China via Mongolia.
In addition, gas supplies will be expanded via other routes, which the Kremlin sees as a major political victory.
According to Gazprom CEO Alexey Miller, they can supply up to 50 billion cubic meters per year through Power of Siberia 2 for 30 years.
He also added that the price of fuel will be lower than what the Russian monopolist currently charges customers in Europe.
Beijing has yet to confirm details of Miller's statement. China's state-run Xinhua news agency, reporting on the bilateral meetings, did not specifically mention the pipeline, although it said the two countries had signed more than 20 cooperation agreements, including in the energy sector.
Discussion of this project has been stalled for many years, although Russia has sought to promote it to compensate for the decline in supplies to Europe.
China has been much more cautious, as growth in gas demand is slowing and Beijing fears over-reliance on a single supplier.
