Gazprom starts to build pipelines connecting Russia and China

Oct. 4, 2006 (China Knowledge) – Russian energy giant Gazprom OAO will start building a natural gas pipeline that will connect Russia and China, reported Xinhua news agency yesterday.The western gas pipeline is considered the main gas route connecting the gas reserves in Russia’s West Siberia to West China’s provinces, bypassing the Republic of Altai. The cost of building the pipeline is estimated to reach US$4 billion to US$5 billion, although costs may depend on the geography of the region. Gazprom has also thought of other possibilities to reduce costs, including building the pipeline via neighboring Kazakhstan.However, an official from the company said that the Altai route seems the most realistic. In addition to the Altai pipeline, Gazprom will also deliver gas via a route from Russia's Far East region to China’s Heilongjiang province.Gas supplies via the two routes will total 68 billion cubic meters per year and both the routes are expected to commence operations from 2011.Gazprom will also cooperate with China in other fields such as gas transportation and gas sales. Gazprom and China National Petroleum Corp. had signed a pipeline agreement which covers the timetable, routes of gas supplies as well as the financial details after Russian president Vladimir Putin visited Beijing in March this year.With China’s energy needs growing, the country is very intent to buy gas from other countries. In earlier media reports, the Chinese government had signed a 25-year agreement with Australia to buy liquefied natural gas and the government will also build a liquefied natural gas terminal by 2009.Related links:China close to sealing deals on Russian pipelinehttp://www.chinaknowledge.com/news/news-detail.aspx?cat=general&id=3682China and Russia sign gas pipelines agreementhttp://www.chinaknowledge.com/news/news-detail.aspx?id=3562Copyright © 2006 www.chinaknowledge.com