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“The term has been determined - it is October: we should finalise a final text of the agreement with China and sign it,” Novak said.
At present, Russia and China are working on an intergovernmental agreement on gas supplies by the “eastern route”. The first gas supplies are expected to start in 4-6 years.
The “eastern route” is an extension from the Sila Sibiri (The Force of Siberia) gas pipeline.
Over the past 10 years, natural gas consumption in China has increased from 24 billion to 100 billion cubic metres a year. There are several possible routes for bringing gas to China. Gazprom insisted that Russian gas be initially supplied to China via the “western route.”
China insisted that gas be initially supplied by the eastern route, which it believes will reduce the cost of Russian gas supplies. At this point, the cost of Russian gas deliveries, including transportation, is close to China’s offer of $250 per 1,000 cubic metres.
The agreement on strategic cooperation between Gazprom and CNPC was signed on October 14, 2004. In June 2009, the governments of Russia and China signed a memorandum of understanding for cooperation in the field of natural gas.