Vladimir Soldatkin, Chen Aizhu

MOSCOW/SINGAPORE – President Vladimir Putin presented a new Russian-Chinese gas deal at a meeting in Beijing Friday with President Xi Jinping. It promised to improve Moscow’s exports from the Far East at a time Putin is at odds over Ukraine.

Russia, already Beijing’s No. Russia, already Beijing’s No. 3 supplier of gas, is strengthening its ties to China, which is the largest energy consumer in the world, and decreasing its dependency on traditional European customers.

Putin stated that “our oilmen have very good new solutions for hydrocarbon supplies to China’s People’s Republic of China” during a meeting to promote closer cooperation.

Putin was visiting Beijing for the Winter Olympics to speak at the conclusion of his speech.

Putin accused the United States and NATO of inflaming tensions about Russia’s neighbor Ukraine. Near the Ukraine-Russia border, more than 100,000 Russian soldiers have been assembled. Moscow has been accused of planning an invasion by Western nations, which Moscow denies.

Russia is Europe’s largest supplier of and the West fears that already stretched supplies might be disrupted by a conflict. The new agreement with Beijing did not allow Moscow to divert gas bound for Europe. It involved gas from Sakhalin in the Pacific, which is unconnected to Russia’s European pipeline network.

Gazprom (MCX) a Russian giant of gas, stated that it will increase its gas exports to China by 48 billion cubic meters per annum. It also plans to use the new pipeline to deliver 10 bcm each year from Russia’s Far East.

Russia was planning to deliver 38 bcm of its oil and gas supplies to China by 2025 under previous plans. It did not say when the target of 48 bcm would be achieved.

An industry source earlier told Reuters that Gazprom (which has a monopoly over Russian gas exports via pipeline) had signed a 30-year agreement with China’s CNPC. The first gas will flow through the pipeline within two- or three years.

SIBERIAN POWER

Russia currently sends gas from China via the Power of Siberia pipeline. It began shipping supplies in 2019 and also by shipping liquefied petroleum gas (LNG). In 2021 Russia exported 16.5 billion cubic meters (bcm), of gas to China, which included 10.5 bcm through the Power of Siberia pipe, which is separate from European gas pipelines.

Putin is joined by several Russian business and government executives. Gazprom head Alexei Miller does not join the delegation.

Rosneft signed a 10-year agreement with CNPC to supply 100m tonnes of oil through Kazakhstan to China. This extends the current deal.