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China to become Russia's biggest gas consumer if western route developed

Published time: May 24, 2014 13:27
Edited time: May 24, 2014 14:15
RIA Novosti / Michail Klimentyev

RIA Novosti / Michail Klimentyev

China could replace Germany as Russia’s biggest gas consumer, if Moscow and Beijing agree to add a route from Russia’s Western Siberia to the one already agreed under a $400 billion contract, President Putin said at a meeting with media in St. Petersburg.

Germany now consumes 40 billion cubic meters of Russian gas annually, and China will start buying even more if the western route is agreed on, Putin said.

“The next step [in Russia-China gas cooperation] is a possibility to make a similar deal on a so-called western route,” President said commenting on a Russia-China megadeal signed Wednesday in Shanghai.

The president added the route connecting Russia’s western Siberia and China could be developed even faster than the eastern.

Though so far there are no concrete agreements on the western route, Putin said it would also be cheaper than the eastern one.

The key issue is connected with pricing and the second project should be easier in this respect as the main mechanism would be already tested by then, he explained.

Aleksey Miller, head of Russia’s gas giant Gazprom has insisted that the gas price in a $400 billion deal was a “commercial secret,” while Aleksandr Medvedev, CEO of Gazprom’s export arm, said it would be well above $350 per 1,000 cubic meters.

The eastern route connects Russia’s Kovykta and Chaynda fields with China, where recoverable resources are estimated at about 3 trillion cubic metres. Putin, however, says they are underestimated and have even more, enough to last for the next 50 years.

Comments (85)

 

james greer 05.06.2014 12:47

The blessings bestowed on the U.S and Briton by God have been removed given to Russia and China. Germany will turn its back on the U.S and the British Empire or what's leftover. Even the sea gates and canals the U.S and Briton once had have been taken away. All but two remain for now, they will be lost also. The U.S and Briton soon to become third world country's. They have turned their backs on God and that is a NO-NO.

 

james greer 05.06.2014 12:35

If Russia and China drops the U.S dollar and trading with the U.S it will be a richly deserved lesson for the U.S government.

 

Terry Ross 26.05.2014 15:48

Michael Dunham 26.05.2014 15:19

The fact of the matter they need to borrow money to fund sections of the Russian budget.

  


No this is not a fact. As I have pointed out there has not only been enough funding from oil and gas for the budget, but enough left to pay down government debt and add to the Naional Wealth Fund. (which is now $87 bn) A parallel Stabilisation fund (from surplus oil and gas revenue) of $88 bn is used to prop up budget due to any downward price movements in oil or gas.

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