SHANGHAI, May 21 (RIA Novosti) – The price for gas under a deal signed Wednesday between Russian gas giant Gazprom and China’s CNPC is tied to the market price of oil and oil products and is satisfactory to both parties, Russian President Vladimir Putin said Wednesday.
Earlier in the day, Gazprom and CNPC signed the 30-year contract on the sale of Russian gas to China at a volume of 38 billion cubic meters per year via an eastern route.
The document was under discussion for several years with the main stumbling block being the gas price, which the parties finally agreed on at the last minute.
Gazprom CEO Alexei Miller declined to name the contract price for gas, saying it was a "commercial secret." He did, however, say that the cost of the entire contract was $400 billion, which if calculated against the total flows, comes to about $350 per 1,000 cubic meters.
In March 2013, Gazprom and CNPC signed a memorandum of understanding on the planned gas supplies to China along the eastern route via the Power of Siberia pipeline. Russian President Vladimir Putin’s current visit to China was the final stage of the negotiating process.
Miller has said the company could receive advance payment from China for the gas, which could start flowing as early as 2018. The planned project has an estimated capacity to pump up to 38 billion cubic meters annually, which could later increase to 60 billion cubic meters.
