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Russia Pitches Gas for China

For several years Russia has been hedging European natural gas consumers with the threat of sending more product east to fuel the industrial growth of China, yet for all the talk, there still has not been a significant increase in the trade (there is some natural reluctance about becoming a simple resource appendage to a neighboring competitor). Looking at comments this week from Igor Sechin, it appears that the Kremlin is interested in moving beyond the rhetoric to reality.

Russia may start delivering natural gas to China in 2015 if the nations can agree on all aspects of their cooperation including infrastructure and sources of delivery, Deputy Prime Minister Igor Sechin told reporters in Beijing earlier today. Russia can provide China with all the gas that it needs, according to Sechin. (…)

“There are no limitations for growth of gas consumption in China,” Sechin said. Russia is a natural partner and is ready to supply China “in full volume” what the country needs for economic development, he said.


Commercial contracts with China, which include gas pricing terms, may be signed by the middle of next year, Sechin said. Gazprom had aimed to send its first gas supplies to China by pipeline in 2011.

“The key sticking point is really on price,” Beveridge said. “The Russians will be looking very much at linking their gas exports to oil prices in China in a similar way to the way they did in Europe.”