Gazprom will supply gas to China for rubles and yuan

MOSCOW, 6 Sep — PRIME. Gazprom and CNPC have agreed to transfer payments for gas supplies to China in rubles and yuan, the Russian company reports.

“Alexey Miller and Chairman of the Board of Directors of CNPC Dai Houliang considered a wide range of areas of interaction between the companies … additional agreements were signed to a long-term gas purchase and sale agreement along the “eastern” route – the Power of Siberia gas pipeline. In particular, a transition to settlements for gas supplies was recorded to China in the national currencies of the countries – rubles and yuan,” the message says on the company’s channel in the Telegram messenger.

The head of Gazprom, Alexei Miller, called the new payment mechanism a mutually beneficial, timely and reliable solution. In his opinion, this will simplify the calculations, give impetus to the development of the economies of Russia and China, and also become an example for other companies.

The Russian and Chinese companies also discussed the development of the Power of Siberia 2 gas pipelines in Russia and Soyuz Vostok in Mongolia.

The first pipeline gas supplies to China – via the Power of Siberia gas pipeline – began at the end of 2019 and amounted to 4.1 billion cubic meters in 2020, and increased two and a half times to 10.4 billion cubic meters the following year. As the project progresses, it is planned to annually increase the volume of deliveries until reaching the design annual capacity of 38 billion cubic meters by 2025.

In early February 2022, Gazprom signed a second long-term contract with CNPC for export via the Far East route. The total volume of supplies according to it will grow to 48 billion cubic meters annually. Taking into account the Power of Siberia 2 gas pipeline and its continuation through Mongolia – the Soyuz Vostok gas pipeline – gas exports to China can be increased by another 50 billion cubic meters per year.