Gazprom Refuses to Use U.S. Benchmark in China Gas Deal - Emerging Europe Real Time - WSJ | Russian state gas firm OAO Gazprom said Thursday it had moved a step closer to making China its largest customer by persuading Beijing that prices shouldn't be linked to a hub based thousands of miles away in Louisiana. In a sign of the global reach of the shale-gas revolution that has propelled the U.S. ahead of Russia as the world's largest gas producer, China National Petroleum Corporation had wanted to link the price for the potential deal to the U.S. benchmark Henry Hub. New techniques have allowed producers in the U.S. to tap gas trapped in rock, creating a surge in volumes and driving the price lower at the Louisiana-based hub. Russia has been in negotiations with China for years on supplying gas, but talks have been hamstrung by disagreements over price. Gazprom and CNPC signed an agreement Thursday that set out almost all conditions for the deal, including the pipeline route and volumes for deliveries—just not the price.
Gazprom hopeful as CNPC ramps up foreign activity - Interfax | China National Petroleum Corp. (CNPC) signed a series of agreements with Russia and Turkmenistan this week as part of ongoing efforts to secure gas supplies. The state-owned company signed a heads of agreement with Gazprom for the long-debated Russia-China gas pipeline deal in St. Petersburg on Thursday, as well as a sales-purchase contract with Russian independent Novatek for shares in Yamal LNG. Also in St. Petersburg, Rosneft President Igor Sechin announced the Russian oil major and CNPC will sign a new exploration and production agreement. The news comes a few days after CNPC agreed to increase gas purchases from Turkmenistan by 25 billion cubic metres per year, raising planned Chinese imports from the Central Asian country to 65 bcm/y by 2020. ...The most definitive of Thursday's St. Petersburg deals was the Novatek agreement. Novatek Chief Executive Leonid Mikhelson told reporters 20% of Yamal LNG's shares would be sold to CNPC. He did not specify the cost of the deal. "The transfer of title to the equity share is subject to receipt of necessary regulatory approvals and expected to be completed by 1 December. Following completion of the deal, the shareholder structure of Yamal LNG will be as follows: Novatek (60%), Total (20%), and CNPC (20%)," Novatek said in a statement.
Gazprom postpones China natural gas pipeline construction - energy global | Russia's state-owned gas producer, Gazprom, has postponed the planned construction of its gas pipeline to China until next year. The pipeline, known in Russia as the Power of Siberia, was designed to carry gas to Russia's Pacific coast in order to feed a new liquefaction plant at Vladivostok. Vedomosti, the Russian business daily newspaper, said "Gazprom delayed the start of the construction of its Power of Siberia gas pipeline to transport gas to China from November 2013 to the first quarter of 2014". A spokesman for Gazprom has declined to comment on the report.