Russia to build gas pipe to China in August

Russia's energy giant Gazprom says it will start welding seams of its major pipeline for gas supplies to China in August.

"We have a clear action plan. We have distributed all duties and we have set tough deadlines," Gazprom said in a statement, citing company CEO Alexei Miller.

"Our goal is to weld Power of Siberia's first joint as soon as August," the Itar-Tass news agency quoted Miller as saying.

China and Russia signed the China and Russia Purchase and Sales Contract on East Route Gas Project and a memorandum on 21 May, and the 30 year contract will see the east route pipeline starting providing China with 38 billion m3/yr of natural gas from 2018.

Vice President of Gazprom Alexander Medvedev said the company and China National Petroleum Corporation (CNPC) have inked a US$ 25 billion advance payment agreement for gas supply.

He said Gazprom will also carry out further negotiations with CNPC on the gas supply of west line and the supply of liquefied natural gas (LNG) in near term.

The Power of Siberia pipeline

The Power of Siberia is a gas transmission system designed to deliver gas from the Irkutsk and Yakutia gas production centers to Russia’s Far East and China.

Gazprom and China National Petroleum Corporation (CNPC) signed a 30 year contract in late May for the sale of Russian gas to China at a volume of 38 billion m³/yr with delivery along the eastern route. The deal is estimated to be worth US$ 400 billion. Russia is planning to invest US$ 55 billion and China around US$ 22 billion in the gas deal.

The gas deal requires the two partners to run additional investment projects to develop the Chayandinskoye and Kovyktinskoye gas fields, build the Power of Siberia gas pipeline in eastern Siberia and an LNG plant in Amur Region.

Edited from various sources by Elizabeth Corner

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