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China starts building ‘Power of Siberia’ pipeline to get gas from Russia

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
File photo shows construction of the Russian section of the Power of Siberia gas pipeline. The pipeline includes eastern and western routes, which are respectively expected to deliver 38 bcm and 30 bcm of Russia’s natural gas to China.

China has started building its share of a gas pipeline, known as the Power of Siberia, which is expected to deliver up to 38 billion cubic meters of Russian natural gas to its southern neighbor annually.

The beginning of the project was announced by the two countries’ officials through video conference on Monday after which Russian Prime Minister Dmitry Medvedev told reporters at a news conference that he hoped Russia and China would reach a deal on increasing Russian gas supplies to China via Russia's Altai region in the near future.

Based on a report by Russian RT news agency, welding operation on the first joint of the pipeline also started as part of the inaugural ceremony in China on Monday. The welding started near the Chinese city of Heihe in the northern province of Heilongjiang, which borders Russia. The pipeline is expected to run as far as Shanghai.

Speaking in the video conference, Medvedev described the pipeline as the world’s biggest infrastructure project.

The deputy prime minister of the State Council of China, Zhang Gaoli, also took part in the ceremony via video link, noting that such large-scale projects constituted a good basis for the promotion of strategic partnership between the two countries.

The Power of Siberia gas pipeline is scheduled to become fully operational in 2018 when it will get connected to China’s gas infrastructure.

The contract for the construction of the pipeline was signed between Russia’s Gazprom and the China National Petroleum Corporation (CNPC) in the form of a 30-year framework deal in May 2014, to transfer 38 billion cubic meters (bcm) of Russian natural gas to China per annum through the eastern route of the pipeline.

File photo shows CEO of Russia's Gazprom, Alexei Miller (R), Russian President Vladimir Putin (C) and deputy prime minister of the People's Republic of China, Zhang Gaoli, attending the ceremony marking the welding of the first link of the "Power of Siberia" main gas pipeline, near the village of Us Khatyn, outside Yakutsk, Russia. ©AFP

The project also includes a western route, known as the Power of Siberia–2 , which is projected to deliver 30 bcm of gas to China. According to Medvedev, construction of the western route will start in the near future.

"I am sure that soon we will reach final agreement on building the second Russian-Chinese pipeline for gas deliveries via the western route," Medvedev said during the inauguration ceremony of the eastern route on Monday.

According to Aleksey Miller, the Gazprom CEO, the total value of the contract has been estimated at USD 400 billion.

Russia started building its section of the 2,500-mile eastern route last year. The pipeline’s gas transmission system (GTS) is scheduled to become operational in late 2017.

The total cost of gas production and construction of gas transmission facilities on the Russian soil has been estimated at USD 55 billion.

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