Russia’s long-discussed Power of Siberia 2 gas pipeline project has taken a step forward with a “legally binding” memorandum between Gazprom and China National Petroleum Corporation, but the deal leaves major uncertainties unresolved.
The planned pipeline would carry 50 billion cubic meters of gas annually from western Siberia through Mongolia to China. While significant, that volume is far below the up to 180 billion cubic meters Russia once sent to Europe each year, meaning it can only partially offset lost European sales. It would supplement the existing Power of Siberia line from eastern Siberia, which has a capacity of 38 billion cubic meters.
Gazprom CEO Alexei Miller announced the agreement during a meeting between Russian President Vladimir Putin and Chinese President Xi Jinping but offered no details on gas pricing or who will finance the multi-billion-dollar construction. Analysts say the announcement was as much about geopolitics as energy, a public display of deepening Russia-China ties and a snub to U.S. liquefied natural gas exports.
The move comes amid shifting global energy alignments. India continues to buy Russian oil despite U.S. tariffs, while China’s LNG purchases from the U.S. remain blocked by trade dispute tariffs. Beijing has instead begun taking shipments from Russia’s Arctic-2 terminal, which is under U.S. and EU sanctions.
Experts caution that the pipeline is far from a done deal. “There’s no confirmed timeline, no definitive pricing agreement,” said Annette Bohr of Chatham House, noting that China has long driven a hard bargain on prices. Beijing may only commit to part of the pipeline and at heavily discounted rates effectively leaving Russia to subsidize Chinese gas consumption.
For now, Power of Siberia 2 remains more a symbol of strategic alignment than a guaranteed commercial reality.
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