While the crisis in Ukraine makes the commercial relationship between Russia and Europe unstable as regards the supply of gas, Moscow is increasingly focusing on the eastern export route, i.e. towards China while Beijing tries to be less dependent on the countries that are part of the Quad alliance . Nikkei Asia reports it today . In particular , preparations for the construction of the new gas pipeline from the Russian island of Sakhalin are in full swing despite the harsh season. Last month, on the sidelines of the summit between Chinese President Xi Jinping and his Russian counterpart Vladimir Putin , the Chinese giant CNPC and Gazprom reachedan agreement to increase Russian gas imports . This was as Moscow proceeded to build up forces on the Russian border in preparation for the invasion.
Currently, Russian gas flows into China through the only pipeline called Power of Siberia, which started its activities in 2019 and has an annual flow rate of 38 billion cubic meters. The construction of another gas pipeline with a capacity of 10 billion cubic meters per year is planned. On March 1, Gazprom announced that it had taken concrete steps towards the construction of the Power of Siberia 2, a pipeline that will cross Mongolia and which will have an annual capacity of 50 billion cubic meters. Beyond the promise of decarbonisation by 2060, Beijing has begun to tackle the endemic pollution of its cities by swapping from coal to natural gas at the Beijing Winter Olympics, which took place last month.
However, Chinese domestic production only covers half of the demand. Two thirds of the import is in the form of liquefied natural gas, of which China has been the world's largest importer since last year, having overtaken Japan. China imports 40 percent of its LNG from Australia, which is a geopolitical opponent and is part of the Quad alliance, Quadrilateral Secutiry Dialogue (US, Australia, Japan and India). Another 10 percent comes from the United States.
(Getty Images)China and Russia are negotiating to build or expand four gas pipelines.
The sum of these projects reaches an increase in imports of 100 billion cubic meters per year, equal to half of the Chinese requirement. This expansion would give Russia a breath of fresh air, which currently supplies between 170 and 200 billion cubic meters to Europe, supplies that will tend to be cut due to geopolitical tensions and the consequent European choice to focus on something else.
Important obstacles remain for the switch to China.
Power of Siberia sent only 10 billion cubic meters of gas last year, less than a third of its total capacity, due to limited transportation capacity on the Russian side. Furthermore, supplies to Europe and those to China come from different fields, distant from each other and not connected. This implies that massive investments are needed to connect them, investments that Moscow cannot afford. But China does.