Russian gas export to China could exceed the volume of export to Europe, said Gasprom President Aleksei Miller. However, we will need to build another gas pipeline worth at least $30 billion for that. The price of the contract concluded with China already dropped from $400 to $300 billion, because cost of oil, to which gas price is tied up to, has decreased by almost a quarter since signing of the contract.
Russia could start delivering more gas to China, than Europe, Aleksei Miller said on Sunday during his visit to China, where he has signed the Russian-Chinese memorandum on gas deliveries via the so-called “western route” (Altai gas pipeline).
“Considering increase in the deliveries via the “western route,” in mid-term the volume of deliveries to China could exceed the current volume of export to Europe,” Miller added.
During 2013 Gasprom’s deliveries to the European markets totaled 161.5 billion cub.m. In early October 2014 Miller said that gas deliveries to China could reach 100 billion cub.m.
President of the Russian monopoly said that the documents envisage that the “western route,” via which gas will be transported to China from the western Siberia (from here gas will be also exported to Europe), becomes a priority project of the Russian-Chinese gas cooperation. China is expected to receive 30 billion cub.m. of gas a year during 30 years. The further steps include signing of the purchase-sale agreement and the intergovernmental agreement.
In may 2014 Russia and China concluded a contract to transport 38 billion cub.m. of gas a year via the western route (Siberian Force gas pipeline) during 30 years. Miller said the sum of the contract totaled $400 billion.
Head of East European Gas Analysis Mikhail Korchemkin reminded that the May contract has been indexed to oil, which went down by a quarter already. “Therefore, at present cost of the contract is not $400, but $300,” the expert said. He added that another gas pipeline worth at least $30 billion will have to be built to increase the gas deliveries to China.
China slowly increases share of gas in its power balance. At present it constitutes about 5%, while the Chinese authorities plan to increase it to at least 30%. This is mainly connected with the fact that because of mass coal consumption the sky above the Chinese metropolis is covered by a coal smog.
In October 2014 Chinese media have released the forecast, according to which by 2030 China will increase its gas consumption from the current 167 to 550 billion cub.m.
