Pipeliners

31 May 2007 - Upstream OnLine - Russia is in talks to build a gas pipeline to China which should be partially completed in the next five to six years and is interested in investing further in the country's energy sector, Russia's energy minister said today. "We will go about developing infrastructure for supplies of natural gas and crude oil to China," Viktor Khristenko, Russian minister of industry and energy, told Reuters in an interview. Russia was also interested in investing in oil production, refining and marketing in China - the world's second largest oil consumer - in addition to gas distribution. He said Moscow wanted to build gas pipelines from gas fields in eastern and western Siberia. Decisions would be made based on the development of the Chinese gas market and restructuring of its energy markets as a whole. "To a certain extent, there's uncertainty related to the fact that the natural gas market in China is in the making," he said. "I think it may also be linked potentially with the discussion on the greenhouse gas emission problems and the respective restructuring of the Chinese energy sector." Khristenko said talks were underway and that progress on at least one pipeline was expected in the next five to six years. "Volumes, capacities and timeframe for such gas transport distribution systems are being discussed," he said. "That's mid-term. We're not talking about 20 years from now. Rather five to six years." He said Russia's expansion to China would not jeopardise contracts between Gazprom and Europe, which is heavily reliant on Russian gas. "This bears no risk for Gazprom's obligations towards its European partners. There are contracts, and as such these obligations for up to 30 years from now will be fulfilled." Russia, which has been criticised for not investing enough to meet its future export obligations, currently supplies about 25% of the 27-nation European Union's gas. Khristenko said there was enough gas to go around but said Russia would balance new contracts between Europe and consumers in Asia.