​Russian govt approves eastern route for gas supplies to China

Welding the joint at the ceremony marking the joining of the first link in the Power of Siberia main gas pipeline attended by Russian President Vladimir Putin, held at Namsky Highway near Us Khatyn village. (RIA Novosti / Aleksey Nikolskyi)
The Russian government has approved a bill on gas supplies to China via the Power of Siberia pipeline. It will be delivering the estimated 38 billion cubic meters of gas annually as a part of a $400 billion deal.

The agreement defines the basic conditions for cooperation in Russian gas supply to China via the so-called eastern route. It includes the terms of design, construction and operation of the cross-border pipeline sector, the government said Friday.

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The bill was sent to the State Duma for ratification and the next stage will be its approval by the members of parliament.

The conclusion of the pipeline use agreement, which will be valid for 40 years, was one of the conditions of implementation of the gas contract between Gazprom and CNPC.

The overall gas supply contract was concluded for a period of 30 years and envisages the supply of Russian gas to China in the amount of 38 billion cubic meters per year.

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The agreement encourages the use of Russian and Chinese domestic currencies in settlements, as well as the creation of needed tax conditions for authorized organizations from both countries.

The governments of Russia and China should also assist in expanding cooperation between Gazprom and CNPC, including the supply of gas via the western route known as the Altai route. On completion, it’s expected to deliver an additional 30 billion cubic meters of Russian gas annually, and will make China Russia’s biggest gas customer, eclipsing Germany.