Moscow And Beijing Discuss Natural Gas Megaproject
By Vanand Meliksetian – Feb 23, 2019, 10:00 AM CSTJoin Our Community
Diplomatic relations between Moscow and Beijing have significantly improved over the past couple of decades. During the Cold War, the Soviet Union and China were on the brink of war which the U.S. exploited with the ‘Opening of China' during the Nixon administration. However, recent geopolitical and economic developments have created a new strategic environment: Russia controls some of the world’s largest reserves in terms of resources such as oil and gas while China’s expanding economy requires ever-larger volumes of raw materials.
The crisis between Russia and the West has created a rift between Moscow and Europe, its most important customer regarding natural gas. To maintain a steady flow of demand for Russian gas, a political decision was made to speed up negotiations between the state-sponsored companies Gazprom and China National Petroleum Corporation for new energy infrastructure. A historic deal was struck in 2014 concerning the Power of Siberia pipeline valued $400 billion for 38 bcm of gas over 30 years. While the first delivery of gas is set on December 1st, negotiations are ongoing for another pipeline which would make China Gazprom's most significant customer within a decade.