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Is 'Power of Siberia' pipeline to be postponed?

By 0 and 0 and 0
18 March 2015


'Power of Siberia' is a 4,000 kilometre supply route. Picture: Gazprom

The iconic 'Power of Siberia' project could be delayed maybe  delayed, according to 'three sources with direct knowledge of the plans of export firm Gazprom', reported the international news agency. The 'exclusive' report indicated the Altai project - involving a pipeline through an area regarded as sacred by locals and environmentalists - could come first. 

'The sources, speaking on condition of anonymity, said the "Power of Siberia" project may be put off until Moscow completes a separate, less ambitious project to send gas from existing fields to China through a pipeline thousands of kilometres further west,' reported Reuters.

Moscow has denied any plans to postpone the $55 billion 'Power of Siberia' pipeline despite a fall in global energy prices. 

The easterly pipeline is due to come on stream in 2019. Gazprom declined to comment to Reuters. 

'Power of Siberia' is a 4,000 kilometre supply route and the deal heralding its development was only signed in May 2014. 

Some 38 billion cubic metres of gas a year would be moved from new gas fields in the Sakha Republic to China's eastern industrial heartland. Some gas could also be shipped from Russia's Pacific Ocean port at Vladivostok.

The signing was seen as 'a diplomatic coup for the Kremlin', reported the news agency. Driving the alleged decision was the need to tap into Yamal gas, including the giant Bovanenkovo Yamal field opened in 2012, which now pumps around 40 billion cubic metres a year but can produce up to 140 bcm.

'Yamal gas needs new markets - that's why Gazprom is pushing for the Altai route. That's why neither Vladivostok nor the Power of Siberia are a priority - the last one even has no source to be connected to,' said a banker close to Gazprom, according to Reuters. 

'The Altai pipeline is much cheaper to build for Russia than the "Power of Siberia" project, and would soak up existing spare capacity rather than require the development of new fields,' said Reuters.

'But Altai gas would reach China at its remote far western border, requiring a huge new pipeline system within China to take it to cities mainly in the centre and east'.

Comments (1)

The Altai pipeline will reach not just China but also India: NOVOSIBIRSK-URUMQI-NEW DELHI So, that is what it takes prirority, because it will be the vertebral column from the BRICS. On the midterm, a RICFTA, a free trade agreement between Russia, China and India will be created based on the model of NAFTA, so Russia and India will be in a decade among the three largest trade partners of China, the same way as Canada and Mexico became two of the three largest trade partners of the US years after NAFTA. So, that makes the Altai pipeline a priority for its symbolism.
Enrique, Spain
19/03/2015 01:42

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