BEIJING, Oct 12 — Russia and China will ink a gas pact on Tuesday during Russian Premier Vladimir Putin’s visit, an industry official and local media said, as pressure builds for the world’s top gas exporter to make concrete moves to supply the world’s No.2 energy user.
Little headway has been made on multi-billion-dollar gas pipeline deals since an agreement in early 2006 also when Putin, then Russia’s President, visited China, as the two nations have failed to agree on prices.
An official with PetroChina China’s top gas producer and pipeline operator, told Reuters today that a gas deal would be signed on Tuesday between the two countries, but declined to give details.
China Daily reported on Monday that Russian gas monopoly Gazprom would sign a supplementary pact on strategic cooperation with CNPC, parent of PetroChina, with the intention of substantially boosting natural gas exports to China.
It was not clear if this new pact would bring Russia-China gas projects forward in any concrete way. Industry experts have said the pressure is more on Moscow as Beijing has secured a string of long-term import gas deals in an effort to make its fast economic expansion greener.
“I suspect there will be only tentative principles, instead of solid deals,” said a CNPC official familiar with the firm’s gas strategy. “A concrete agreement would require a lot of preparatory work that we should have been aware of.”
Turkmenistan, central Asia’s largest gas producer, will start in December pumping gas to western China via a 7,000-km (4,375-mile) pipeline with an eventual capacity of 40 billion cubic metres a year, almost half of China’s current domestic output.
Taking advantage of weaker global demand, China has also since 2008 landed a series of liquefied natural gas (LNG) deals with exporters like Australia and Qatar, through long-term supply agreements with firms such as Shell, ExxonMobil and Total.
All these deals have run ahead of the Russian projects.
Under the 2006 pact, Gazprom planned to build two gas pipelines to supply China with 60-80 billion cubic metres of natural gas a year.
But until a few weeks ago, a Gazprom official in charge of contract and pricing told Reuters that “huge differences” on pricing remained between the Chinese and Russians. — Reuters
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