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Tuesday, July 08, 2008

China to Pay More for Gas than Europe

Open Gallery...July 03, 2008 - Kommersant - Each 1,000 cu meters of gas to be supplied via Altai pipeline to China’s border will cost $10 to $15 more than the gas supplied to Europe, State Duma Vice Speaker Valery Yazev announced July 3. Yazev is the president of Russia’s Gas Society. “The issue of Altai gas pipeline, the western variant, is being considered now. The price should be a bit higher than on the border with Europe,” Yazev said during the Moscow-Beijing video conference held in RIA Novosti. The reason is the greater haul distance from northern Tyumen to China’s border vs the deliveries to Europe, the official explained. Gazprom CEO Alexei Miller said earlier that the gas price would average roughly $400/ths cubic meters for Europe in 2008. Russia intends to annually export to China 68 billion cu meters of gas by 2020. The memorandum on Russia’s gas supplies to China was signed far back in 2006. The plans were to deliver the gas via Altai pipeline, but the parties’ inability to agree on the gas price delays the design and construction of the pipeline.

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