Alexander Miller, energy market consultant – Eurasia Business News, February 4, 2022

View on business towers in Beijing, the capital city of the Popular Republic of China.

The Russian Gazprom and the Chinese CNPC signed a new agreement on gas supplies to China from the Russian Far East. The signature took place during the official visit of Russian President Vladimir Putin to China.

Agreement for the sale and purchase of natural gas along the Far East route between PJSC Gazprom and the China National Oil and Gas Corporation,” reported the statement of the Kremlin.

Earlier, President Putin, at a meeting with Chinese President Xi Jinping, said :

“For our today’s meeting, our oilmen have prepared very good new solutions for the supply of hydrocarbons to the People’s Republic of China and another step forward has been taken in the gas industry. I mean a new contract for the supply of gas to China from the Far East of Russia at 10 billion cubic meters of gas per year.”

As reported, in 2015, Gazprom and CNPC signed an agreement on the main conditions for pipeline gas supplies from Western Siberian fields to China along the “western” route (via the Power of Siberia – 2 gas pipeline) and a memorandum of understanding on the project of pipeline natural gas supplies to China from the Russian Far East.

In December 2017, Gazprom and CNPC signed an agreement on the main conditions for the supply of natural gas from the Russian Far East to China.

Gazprom is pumping gas to China via the Power of Siberia pipeline, an agreement on which was signed in 2014, during the Ukrainian crisis and after Western sanctions against Russia.

The pipe, built entirely with Russian money, for which Beijing has not allocated a cent, should reach its design capacity in 2024 – 38 billion cubic meters per year.

Gazprom’s largest field in the Far East is the Yuzhno-Kirinskoye field, where gas production is due to begin in 2023.

The Russian state gas group Gazprom has announced that these exports should reach 48 billion cubic meters (m3) per year in 10 billion m3 via a new gas pipeline. According to an industry source, Gazprom has a 30-year contract with China’s CNPC and the first deliveries are expected in two or three years. The new contract is designed for 25 years, said Dmitry Peskov, the press secretary of the Russian President. Thus, the total volume of deliveries will increase by 250 billion cubic meters.

The Yuzhno-Kirinskoye field was discovered in 2010. According to the latest report, the current hydrocarbon reserves amount to 611.7 billion cubic meters in the sum of industrial categories B1 + B2 of gas. m. According to the approved technical scheme, the field is expected to produce 21 billion cubic meters of gas (stock of production wells – 37 units).

22 wells (exploratory, exploration, production) were built at the field, including 14 gas condensate production wells.

The Yuzhno-Kirinskoye gas and condensate field fell under US sanctions in 2015.

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