ULAN BATOR, September 03. /ITAR-TASS/. Russia’s Gazprom and China National Petroleum Corporation (CNPC) will need to decide whether their gas pipeline will run through Mongolia or not, Russian Natural Resources and the Environment Minister Sergei Donskoy on Wednesday.

During his talks with Russian President Vladimir Putin, Mongolian President Tsakhiagiin Elbegdorj suggested building the pipeline across his country.

“This issue will have to be discussed at the level of Gazprom and CNPC. As a buyer, they (CNPC) should make assessments, raise questions and put forth demands. Mongolia will have to answer these questions,” Donskoy said.

He said Mongolia’s proposal could be attractive since the pipeline will run mainly across the plains and therefore will need fewer booster stations. But problems may arise if the pipeline crosses nature reserves in Mongolia, he added.

Donskoy said this issue had been under discussion since the autumn of 2013.

Russia-China gas deal

In May 2014, Gazprom and China National Petroleum Corporation (CNPC) signed a $400 billion contract for the supply of Russian pipeline gas to China. Under the contract, Russia will supply 38 billion cubic meters of gas a year for 30 years.

CNPC is China’s largest petroleum company owned by the state and is one of the world's leading integrated oil and gas production companies.

In October 2009, Gazprom and CNPC concluded the Framework Agreement on the major terms and conditions of natural gas supply from Russia to China. The Agreement stipulates annual exports of up to 68 billion cubic meters of gas to the Chinese market. In September 2010 the Extended Major Terms of natural gas supply from Russia to China were signed.

In March 2013, Gazprom and CNPC signed the Memorandum of Understanding for cooperation between the two companies in pipeline gas deliveries to China via the eastern route.

In September 2013, Gazprom and CNPC inked an agreement determining major terms and conditions of pipeline gas supply from Russia to China via the so-called eastern route, which will transport 38 billion cubic metres of Russian gas to China.

The western route will deliver West Siberian gas to China from 2019.