A delegation from Russia’s Gazprom visited China Wednesday and talked up the prospects for delivering Russian gas via a pipeline currently in development to the People’s Republic.

Beijing hosted a meeting of Alexey Miller, chairman of the Gazprom management committee, and Jiang Jiemin, chairman of the board of China National Petroleum Corp. (CNPC).

“The parties addressed a wide spectrum of issues surrounding the companies’ cooperation in the gas sector,” Gazprom said. “Special focus was laid on key commercial and technical parameters of pipeline gas supplies to the People’s Republic of China market, particularly, from the Power of Siberia gas pipeline. It was noted that joint efforts had been ramped up to sign a contract for Russian gas supply to China in 2013.”

CNPC is the largest state-owned petroleum company in China. Gazprom and CNPC signed an agreement of strategic cooperation in 2004 that covers consideration of supplying Russian gas to China. Opportunities are also being explored for joint gas processing and gas chemical projects in eastern Russia and in other countries, Gazprom said.

China’s gas market is viewed as a major prize by would-be exporters of liquefied natural gas (LNG) in the United States, Western Canada and elsewhere (see Daily GPI, Feb. 22; Feb. 20; Feb. 7). Meanwhile, China has showed a growing appetite for North American natural gas reserves as evidenced by China National Offshore Oil Co.’s acquisition of Calgary-based Nexen Inc. (see Daily GPI, Feb. 13).

The Power of Siberia is a pipeline planned to serve the Irkutsk and Yakutia gas production centers and carry gas to to Vladivostok via Khabarovsk. The Yakutia-Khabarovsk-Vladivostok gas trunkline is to be constructed as the first stage, and as the second stage of the project the Irkutsk center is to be connected to the Yakutia center, Gazprom said. The pipeline route is to run parallel with the Eastern Siberia-Pacific Ocean oil pipeline. The first section of the Power of Siberia, the Yakutia-Khabarovsk-Vladivostok trunkline is expected to come online in late 2017.

In 2009 Gazprom and CNPC inked a framework agreement on major terms and conditions for natural gas supply from Russia to China and a heads of agreement on gas supply from Russia to China was signed. Currently, Gazprom and CNPC are negotiating the commercial parameters of Russian gas supply projects envisaging the annual export of about 68 billion cubic meters of gas to China.

Meeting participants on Wednesday also exchanged views regarding deeper cooperation between the companies, underground gas storage in China and LNG supplies in the framework of the Vladivostok-LNG project, Gazprom said.

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