Gazprom News

21 December 2017

Alexey Miller: Basis Laid for Another Pipeline Route of Russian Gas Supplies to China

A working meeting between Alexey Miller, Chairman of the Gazprom Management Committee, and Wang Yilin, Chairman of the Board of Directors of CNPC, took place in Beijing today.

Highlighting the successes of their partnership in the gas sector, the parties noted the progress made in the implementation of the project for Russian gas exports to China via the eastern route. Negotiations continue over the planned supplies from Russia’s Far East. In addition, the companies carry on with their active collaboration in such areas as underground gas storage, gas-fired power generation, and the use of gas as a vehicle fuel.

After the meeting, Alexey Miller and Wang Yilin signed the Heads of Agreement for natural gas to be supplied from Russia’s Far East to China. The document outlines the basic parameters of future supplies, namely the volumes, the term of the contract, the starting date of supplies, the surge period, and the cross-border point. The corresponding contract is expected to be inked in 2018.

The parties also signed the Coordination Agreement — the addendum to the Sales and Purchase Agreement for gas to be supplied via the eastern route. The new Agreement sets out, inter alia, the modalities of interaction and the gas metering procedure in the course of conveying gas.

“Today, we laid the basis for another pipeline route of Russian gas supplies to China. The project will expand the range of options for satisfying the growing demand for gas in the Chinese market,” said Alexey Miller. 

Background

Gazprom’s main partner in China is CNPC, a state-owned oil and gas company.
On May 21, 2014, Gazprom and CNPC signed the Sales and Purchase Agreement for Russian gas to be supplied via the eastern route (Power of Siberia gas pipeline). The 30-year Agreement provides for gas deliveries to China in the amount of 38 billion cubic meters per year.
In 2015, Gazprom and CNPC inked the Memorandum of Understanding for the project of pipeline gas supplies to China from Russia’s Far East.
In 2016, Gazprom and CNPC signed the Memorandum of Understanding on underground gas storage and gas-fired power generation in China and the Memorandum to explore the opportunities for cooperation in the NGV sector.
On July 4, 2017, Gazprom and CNPC signed the Supplementary Agreement to the Sales and Purchase Agreement for gas to be supplied via the eastern route inked in 2014. According to the document, gas supplies will commence on December 20, 2019.
 

Source: http://www.gazprom.com/press/news/2017/december/article388463/

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