Russia, China Agree To Expedite Power of Siberia 2 Pipeline Agreement

Russian President Vladimir Putin and China’s President Xi Jinping have agreed to speed up the Power of Siberia 2 gas pipeline project, according to Russian Deputy Prime Minister Aleksandr Novak. The announcement was made on Thursday (May 8) following high-level talks in Moscow during Xi’s official visit to Russia to attend the May 9 Victory Day celebrations.

The planned mega pipeline is expected to allow up to 50 billion cubic meters (bcm) of natural gas to be delivered annually from northern Russia to China via Mongolia. The project has experienced delays due to deliberations on pricing and route.

Novak said “It is an important project. A certain amount of work has already been done, including the feasibility study. The two leaders gave instructions to expedite the process.”

Moscow is pursuing the project as it seeks to diversify its energy export markets amid Western sanctions and reduced European demand. For Beijing, the pipeline promises a stable energy supply to support its consumption needs.

Russia currently delivers gas to China via the Power of Siberia 1 pipeline, which is part of a US$400 billion, 30-year agreement between Gazprom and China’s CNPC which was signed in 2014. Deliveries started in 2019, and the conduit reached its full operational capacity in December, making Russia China’s leading supplier of natural gas.

Gazprom projects that gas exports will grow further due to soaring China demand. It is the world’s largest economy in PPP GDP terms, has an annual growth rate of about 5% and a population of 1.41 billion. In December, Novak announced that Russia has begun developing a new gas pipeline to China via Kazakhstan. Once all pipelines are fully operational, he noted, the volume of Russian gas supplies to China could reach nearly 100 bcm annually. Bilateral turnover between Russia and China reached a record US$245 billion in 2024.