China, Russia on verge of signing big gas deal

BEIJING - The Associated Press

A tentative agreement signed in 2013 calls for Gazprom to deliver 38 billion cubic meters of gas per year beginning in 2018, with an option to increase that to 60 bcm. AP Photo

China plans to sign a multibillion-dollar deal to buy Russian gas during a visit by President Vladimir Putin next week.

Negotiations that began more than a decade ago had stalled over price. But analysts say Moscow, isolated over its role in Ukraine, faces pressure to make concessions in exchange for an economic and political boost.

“We are still exchanging views with Moscow and we will try our best to ensure that this contract can be signed and witnessed by the two presidents during President Putin’s visit to China,” a deputy Chinese foreign minister, Cheng Guoping, told reporters on May 15. Putin is due to meet Chinese President Xi Jinping during a two-day conference on Asian security that starts May 20 in Shanghai. China faces chronic gas shortages and talks on the proposed 30-year contract between Russia’s government-controlled Gazprom and state-owned China National Petroleum Corp. began long before the Ukraine crisis.

Chinese leaders are also eager to get Russian gas to help curb pollution by reducing reliance on coal. A tentative agreement signed in March 2013 calls for Gazprom to deliver 38 billion cubic meters of gas per year beginning in 2018, with an option to increase that to 60 billion cubic meters.

Plans call for building a pipeline to link China’s northeast to a line that carries gas from western Siberia to the Pacific port of Vladivostok.