Gazprom and CNPC discuss planned supplies of Russian gas to China
A Gazprom delegation headed by Alexey Miller, Chairman of the Company's Management Committee, paid a working visit to China today.
As part of the visit, a meeting between Alexey Miller and Wang Yilin, Chairman of the Board of Directors of CNPC, took place in Beijing.
The parties reviewed a wide range of issues related to cooperation between the companies, focusing on the ongoing preparations for the start of gas supplies to China via the Power of Siberia gas pipeline.
Developing gas resources and shaping gas transmission system in eastern Russia
Particular attention at the meeting was paid to the planned deliveries of Russian gas to China from the Far East and via the western route. It was noted that in 2018 China became the world's largest natural gas importer. Its imports totaled 125.7 billion cubic meters, a 31 per cent increase (30.3 billion cubic meters) against 2017. This growth was achieved primarily through liquefied natural gas (LNG), since China is currently unable to satisfy the rising gas demand using the existing gas pipelines.
As Alexey Miller said after the negotiations, “Construction of the Power of Siberia gas pipeline is going ahead of schedule, and Gazprom will start delivering gas to China well in advance, as early as December 1, 2019.”
Alexey Miller and Wang Yilin also discussed their companies' collaboration in the areas of gas-fired power generation, use of natural gas as a vehicle fuel, underground gas storage, and science and culture.
Gazprom's main partner in China is CNPC, a state-owned oil and gas company.
On May 21, 2014, Gazprom and CNPC signed the 30-year Sales and Purchase Agreement for Russian gas to be supplied via the eastern route (Power of Siberia gas pipeline). The document 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, the Memorandum to explore the opportunities for cooperation in the NGV sector, and the Agreement to cooperate in the field of mutual recognition of standards and conformity assessment results.
In July 2017, Gazprom and CNPC signed the Supplementary Agreement to the Sales and Purchase Agreement for gas to be supplied via the eastern route concluded in 2014.
In December 2017, Gazprom and CNPC signed the Heads of Agreement for natural gas to be supplied from Russia's Far East to China.