News Room - Business/Economics

Posted on 13 Oct 2009

China, Russia to sign major gas deal

China and Russia on Tuesday will sign a deal in Beijing that will see 70 billion cubic metres of natural gas sent to China annually, the head of Russian gas giant Gazprom, Alexei Miller, said.

 

The agreement will be signed in the presence of visiting Russian Prime Minister Vladimir Putin and Chinese Premier Wen Jiabao, Miller told reporters.

 

"A framework agreement has been initialled. This document will be signed today," Miller said.

 

"It will be a long-term contract, about 70 billion cubic metres" of gas annually, he said.

 

Miller declined to provide financial details on the deal but said the gas could begin to flow as early as next year.

 

He had announced two weeks ago that the two sides would ink a natural gas agreement during the current visit.

 

Gazprom is keen to diversify its client base beyond its traditional European consumers, who have in recent years been looking for ways to reduce their dependence on Russian gas.

 

Gazprom and the China National Petroleum Corp (CNPC) had in 2006 agreed to build two major pipelines within five years to supply tens of billions of cubic metres of Russian gas to China annually.

 

It was not immediately clear whether the deal set to be signed Tuesday was separate from the 2006 agreement.