Gazprom has commenced with the construction of the 4,000km Power of Siberia pipeline – which will ship $400bn worth of Russian gas to China.
Gazprom will deliver 38 billion cubic metres of natural gas to China for a period of 30 years, via the Power of Siberia trunkline. The trunkline features the Yakutia and Irkutsk production centres, which were built to supply gas to Russia’s Far East and China.
Gas from the production centres will be shipped to Vladivostok through Khabarovsk. The first phase of the project includes the construction of the Yakutia / Khabarovsk / Vladivostok gas trunkline.
Under the second phase, the Irkutsk centre will be linked to the Yakutia centre by the gas pipeline. The Power of Siberia will become a unified gas transmission system (GTS) for the gas production centres.
Flows via the pipeline will commence at five billion cubic metres of gas in 2019, increasing to 38 billion cubic metres under a deal signed by Gazprom and China National Petroleum (CNPC) in May 2014.
Gazprom plans to invest $55bn in the construction of new production and transmission facilities.
Gazprom management committee chairman Alexey Miller said, “Power of Siberia opens up new opportunities for gasification of eastern Siberia and the Far East.”
“Due to this project, thousands of new jobs will be created and accommodation and social infrastructure will be constructed.”
In 2009, Gazprom and CNPC signed a framework agreement on major terms and conditions of gas supply from Russia to China, which included annual exports of up to 68 billion cubic metres.
Terms were agreed on supply via the eastern route in September 2013.
The deal will allow Russia to reduce its dependence on Europe, following the imposition of economic sanctions due to the situation in Ukraine.