ST. PETERSBURG, May 22 (RIA Novosti) – The long-term gas deal signed by Russian gas giant Gazprom and China’s CNPC will boost the development of all of Eastern Siberia, Russian Deputy Energy Minister Kirill Molodtsov told journalists Thursday.
“This is really a breakthrough deal,” Molodtsov said during remarks at the 2014 International Economic Forum that kicked off earlier in the day in St. Petersburg.
“This contract has been debated for a long time. Thirty-eight billion cubic meters, which are planned for annual deliveries, is a serious stage of development both for Gazprom and the adjacent territories, and for the goals we are set to achieve in relation to oil fields, even despite the fact that it is a gas deal, and in relation to associated petroleum gas deposits. This is an integrated development of the territory, which is necessary at the moment,” he said.
Gazprom CEO Alexey Miller and CNPC Chairman Zhou Jiping sealed the historic deal for Russian gas deliveries to China early on Wednesday in the presence of both countries' leaders.
The 30-year contract provides for the sale of Russian gas to China at a volume of 38 billion cubic meters per year with delivery via an eastern pipeline. According to Miller, the value of the entire contract is $400 billion, though the contract price for gas has not been revealed yet. Experts say it could exceed analyst estimates of $350 per thousand cubic meters
Under the deal, Russia’s overall investment on delivering gas to China is $55 billion and China’s investment is estimated at around $22 billion.
