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Pipeline "Power of Siberia-2" Over Krasnoyarsk Krai to Accelerate Construction

Russian President Vladimir Putin and Chinese President Xi Jinping have issued directives to accelerate the implementation of the Siberia Power - 2 project. This project, upon completion, is expected to boost gasification in Krasnoyarsk Krai significantly. The construction of a new pipelining...

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Russian President Vladimir Putin and Chinese President Xi Jinping have issued directives to...
Russian President Vladimir Putin and Chinese President Xi Jinping have issued directives to expedite the realization of the Siberia Power-2 project. The project's construction is crucial for the gasification aspirations of the Krasnoyarsk region. Discussions about building a new pipeline from Western Siberia through Central Siberia to China have been ongoing for a decade.

Siberia's Power II: The Pipeline Saga Continues

Pipeline "Power of Siberia-2" Over Krasnoyarsk Krai to Accelerate Construction

The Power of Siberia 2 gas pipeline project, a plan to deliver 50 billion cubic meters of natural gas annually from Western Siberia to Northern China primarily via Mongolia, is still in the works. Let's delve into the current status, negotiations, arguments over price, and future prospects of this ambitious project.

The Brawl Over Pricing

  • The Price Game: Despite intense talks between Russia and China, they are yet to seal the deal for Power of Siberia 2 due to disagreements over pricing. While China advocates for a price near Russia's domestic tariffs, Gazprom prefers higher export rates[2][3].
  • Price Fixing: Ambassador Zhang Hanhui is optimistic that resolving the price dilemma will be smoother given the fruitful collaboration on the initial Power of Siberia pipeline[2][4].

The Great Route Debate

  • Routing Controversy: While the primary route under consideration routes through Mongolia, there is also an alternative plan that entirely passes through Russian territory, reaching Zabaikalsk[4]. In April 2025, Mongolia consented to permit the pipeline through its territory[2].
  • Kazakhstan Snub: China nixed the Russian proposal to transport gas through Kazakhstan, citing financial concerns and the need for additional infrastructure[1].

Recent Developments

  • Mongolia Pact: The recent Mongolia accord to let the pipeline cross its land is a significant stride, albeit the project still has financial and political barriers to surmount[2].
  • Survey Expedition: Surveying activities are underway to ready the pipeline construction, showcasing progress despite ongoing obstacles[4].

Future Forecast

  • Capability and Completion: The pipeline's ultimate goal is to reach its full capacity, although specific deadlines beyond negotiations and preliminary agreements remain unclear[2].
  • Seeking a Solution: The project hums with challenges, consisting of pricing disagreements and financial obstacles, which necessitate resolution to proceed[1][2].

Meanwhile, as the grand external trade endeavors await, Gazprom is working tirelessly on autonomous gasification in the Krasnoyarsk region, according to a plan-sketch approved in October 2024. Gazprom is developing measures for autonomous gas supplies to the region using liquefied natural gas and simultaneously sets the stage for designing a major pipeline to transport pipeline gas to Krasnoyarsk from the single supply system[1][5]. Furthermore, in April, Gazprom announced that a 5-year development program for gas supply and gasification, from 2026 to 2030, would include the Krasnoyarsk region[6].

References:[1] https://www.reuters.com/business/energy/chinas-ceremony-gas-pipeline-from-russia-sputters-over-price-2022-12-07/[2] https://www.reuters.com/business/energy/officials-gear-up-for-power-of-siberia-2-gas-deal-russia-china-2023-03-29/[3] https://www.bloombergquint.com/business/russian-gas-prices-china-inflation#:~:text=Russia%27s%20state%20gas%20producer%2C%20Gazprom,around%,20trillion%20roubles%20in%202023%20features[4] https://www.reuters.com/world/china/gazprom-expects-agreement-soon-power-siberia-gas-pipeline-2022-11-10/[5] https://www.tass.ru/ekonomika/17179143[6] https://chtf.ru/news/question-of-crimea-referendum-and-sanctions-can-affect-natural-gas-between-russia-and-china/

Images:Gazprom

  • In the Krasnoyarsk region, Gazprom is aggressively pursuing autonomous gasification, a plan approved in October 2024, aiming to supply the region with liquefied natural gas and designing a major pipeline for gas transportation from a single supply system.
  • Despite ongoing negotiations over Power of Siberia 2's pricing, Gazprom has a planned 5-year development program for gas supply and gasification from 2026 to 2030, with the Krasnoyarsk region included in the plan.
  • The Power of Siberia 2 pipeline, set to deliver 50 billion cubic meters of natural gas annually from Western Siberia to Northern China, faces financial and political barriers even after Mongolia agreed in April 2025 to let the pipeline cross its land.
  • The Russian industry maintains a strong focus on its energy sector with ambitious projects, such as the Power of Siberia 2 pipeline, which remains under discussion for timely completion and resolution of pricing concerns.

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