On the lookout to enhance its market offering in China, Russia is considering supplying natural gas to China by a pipeline from companies other than Kremlin-controlled Gazprom, which currently has the monopoly for Russian pipeline gas exports, an Energy Ministry official said on Tuesday.
Artem Verkhov, head of Russia's Energy Ministry's department of gas industry development, said natural gas from the deposits of Rosneft and Irkutsk Oil Company, or INK, could be used for the future Power of Siberia 2 pipeline.
Moscow is eyeing the 2,600 km pipeline — which would have a capacity of 50 billion cubic meters (bcm) of gas per year — as a way to replace lost exports to Europe. These were lost as a consequence of Russia's war of aggression in Ukraine.
While Reuters reports that Russia is in a hurry to clinch a deal, Beijing is well-placed to drive a hard bargain as analysts say China is not expected to need additional gas supply until after 2030.Vyacheslav Kulagin from Moscow-based Energy Research Institute told the same conference Russia was unlikely to achieve any profit from the pipeline gas exports to China this decade as it will be recovering costs and paying taxes.
"It would be great if we will gain some profit at Power of Siberia 1 by the middle of the next decade," he said.