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Russia and China deal holds new opportunities

Russia has long craved the Chinese market and China needs gas. The $400 billion deal opens a new trade

Fifteen years after starting negotiations, Russia and China signed a 30-year gas-sales agreement in Shanghai on 21 May. Gazprom agreed to supply 38 billion cubic metres per year (cm/y) – or roughly one-fifth of Chinese gas demand last year – from its East Siberian fields into northeast China through the soon-to-be-built Power of Siberia pipeline. Details on pricing and the timing of first deliveries for the landmark deal are not clear, but initial gas flows are expected through the pipeline starting 2020.  It appears that China will not participate in the gas resource development in Russia, which simplifies the deal structure. But Chinese companies might be invited to help build the pipelin

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