Binding memorandum on Power of Siberia 2 signed, Russia to increase gas exports to China via existing and new routes
BEIJING. Sept 2 (Interfax) - A legally binding memorandum has been signed on the construction of the Power of Siberia 2 gas pipeline from Russia to China and the Soyuz-Vostok transit pipeline through Mongolia, the CEO of Russian gas giant Gazprom , Alexei Miller said after talks between the three countries' leaders in Beijing on Tuesday.
"On the basis of the public statement that was made by the leaders of the three countries - Russia, China and Mongolia - a legally binding memorandum was signed today on the construction of the Power of Siberia 2 gas pipeline and the Soyuz-Vostok transit gas pipeline through the territory of Mongolia. This project will make it possible to supply 50 billion cubic meters of gas per year from Russia with transit through Mongolia," Miller told reporters.
Russia is expected to supply gas under the new agreement for 30 years.
Furthermore, an agreement has been reached to increase gas exports through the existing Power of Siberia pipeline from 38 bcm per year to 44 bcm, Miller said.
"Also within the context of the visit, commercial agreements have been signed between Gazprom and CNPC [China National Petroleum Corporation]. Specifically, on increasing gas supplies to China along the Power of Siberia gas pipeline from 38 bcm of gas per year to 44 bcm of gas per year and on increasing supplies of gas along the Far Eastern Route project by 2 [bcm] per year from 10 [bcm]," Miller said.
Asked about the price of the gas, he said "[we] will report on commercial issues separately."
He also said Gazprom and CNPC signed a new memorandum on strategic cooperation on Tuesday that reflects the new stage of the partners' work on the new projects.
Asked about the payment currency, Miller said he "can say in what currencies payment is made in the current period of time - 50% in rubles and 50% in yuan."
The price of gas for China is objectively lower than for Europe due to the shorter transport distance, he said.
"Gas deliveries to China are made from fields in Eastern Siberia, while to Europe [gas is transported] from Western Siberia. Fields in Western Siberia are located significantly further than fields in Eastern Siberia are to the border of Russia and China or Russia and Mongolia. Accordingly, the transport costs of delivering gas to the Chinese market are significantly lower. Therefore, objectively, the Chinese market is closer, logistics expenses are lower, so the price is also objectively lower," Miller said.
He also recalled that the format of the 50-bcm-per-year gas pipeline through Mongolia to China was determined in the previous decade.
"We must recall when the decision was made to build Power of Siberia 2 and the Soyuz-Vostok gas pipeline. They were made even before the Power of Siberia trunk pipeline was put into operation [in 2019], even before supplies of Russian gas to China physically began," Miller said.
Russia began exporting gas to China through the Power of Siberia pipeline in 2019 under a long-term purchase-sale contract between Gazprom and CNPC. Exports have exceeded annual contractual obligations since 2020. Russia exported 31.12 bcm of gas along the pipeline in 2024 and daily deliveries reached the maximum contractual level, which is 38 bcm in annual terms, on December 1, 2024, a month earlier than originally scheduled. Gazprom increased gas exports to China by 28% in the first eight months of 2025.
