Exec: Gazprom agrees on price formula for gas supplies to China

YUZHNO-SAKHALINSK, Sep 27 (PRIME) -- Russian natural gas company Gazprom has reached an agreement on a formula to calculate the price of Russian natural gas supplies to China, Gazprom Deputy CEO Alexander Medvedev told reporters Tuesday.

The Russian company could sign a contract on gas supplies to China by the end of 2011, after which the construction of transportation facilities could be started, Medvedev said, adding that gas supplies could start at the end of 2015.

Gazprom plans to supply a total of 68 billion cubic meters of gas to China per year, Medvedev said in June.

The Russian company is considering supplying gas to China via a yet-to-be-built Altai gas pipeline. Investments in the construction of the pipeline are estimated at U.S. $14 billion Medvedev also said in June. Specifically, Gazprom planned to annually supply up to 30 billion cubic meters of gas to northwestern China via the so-called “western route,” or the Altai gas pipeline, as well as 38 billion cubic meters of gas via an eastern route to northeastern China.

Gazprom and CNPC signed legally-binding documents on the gas supplies in September 2010.

End