The Presidents of Russia and China, Vladimir Putin and Xi Jinping, oversaw today via video link the ceremonial commissioning of the "Power of Siberia" gas pipeline, the first to connect their countries.
"This inauguration is truly a historic event not only for the world energy market, but above all for us, for Russia and for China. This project will bring Russian-Chinese strategic cooperation to a completely different level," said Putin, who watched the opening in Sochi via video link.
The 2.000-kilometer "Power of Siberia" gas pipeline connects oil fields in eastern Siberia with China. For now, it reaches the border of the two countries, and when it is completely finished, it should be more than 3.000 kilometers long.
It is estimated that "Power of Siberia" will cost 55 billion dollars when 2022-2023. will reach a capacity of 38 billion cubic meters per year, which is 9,5 percent of gas consumption in China.
Due to such a high price, which they consider "astronomical", critics of the gas pipeline say that it will never be profitable, but that it is above all a "political and diplomatic project".
The first Russian-Chinese gas pipeline, which should respond to China's huge energy appetite, symbolizes a strategic partnership, especially in the field of energy.
"The development of Sino-Russian relations is and will be a foreign policy priority of both our countries. It is a historic project... it is an example of deep integration and mutually beneficial cooperation," Xi Jinping said via video link.
The head of Gazprom, Alexey Miller, surrounded by his employees in his company's white and blue uniforms, declared that the "valve was opened" and that the gas began to flow. On the Chinese side, the employees of Petročajna, Gazprom's partner, were dressed in red.
China is due to complete its part of the pipeline in 2022-2023. when the gas will reach Shanghai.
Traffic through the gas pipeline should gradually increase to 38 billion cubic meters per year in 2025. It cements China as Russia's main export market for gas and gives Russia a potential new market outside of Europe.
Moscow plans to open two more large gas pipelines: "Nord Stream 2" which runs along the bottom of the Baltic Sea to Germany and "Turkey Stream" to the south of Europe.
In May 2014, the Russian energy giant Gazprom and the Chinese CNPC signed an agreement according to the provisions of which the Russian side is obliged to supply 30 billion cubic meters of gas per year through the "Power of Siberia" gas pipeline for the next 38 years. In the beginning, as announced, about ten million cubic meters of natural gas will be pumped per day.
The Russian-Chinese gas pipeline is followed by a huge contract on the supply of gas to China, estimated at more than 400 billion dollars for 30 years, which Gazprom and China's CNPC signed in May 2014, after a decade of negotiations.
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