Russia Signs Power Siberia 2 Pipeline Deal with China, Price Unclear

Russia’s Gazprom has signed a legally binding memorandum with China and Mongolia to build the Power of Siberia 2 gas pipeline, which will run through Mongolia to China and has a planned capacity of 50 billion cubic meters per year over 30 years. The pipeline, described by Gazprom CEO Alexei Miller as the world’s largest and most capital-intensive gas project, aims to increase Russian gas supply to China amid Russia's loss of much of the European gas market due to Western sanctions. In addition to the new pipeline, Russia and China agreed to increase supplies via the existing Power of Siberia pipeline from 38 to 44 billion cubic meters annually, and also raise volumes on the Far Eastern route. The gas price for China is expected to be lower than what Russia charges European customers, justified by lower transportation costs, though exact pricing terms remain unresolved. The project reflects a deepening energy partnership between Russia and China, with Moscow pivoting east amid geopolitical tensions, while Beijing seeks to balance supply diversification and pricing concessions. Despite the agreement, negotiations on pricing and construction timelines are ongoing, highlighting complexities in the trilateral energy cooperation.