Gazprom, China tentatively agree on $25 billion advance on gas contract

Gazprom and China have tentatively agreed on a $25 billion advance on their gas contract, the head of LLC Gazprom Export Alexander Medvedev told reporters.

Gazprom and China have tentatively agreed on a $25 billion advance on their gas contract, the head of LLC Gazprom Export Alexander Medvedev told reporters.

"The advance has also been agreed, agreed in principle. The details are being discussed. The amount is $25 billion," Medvedev said.

The Russian gas giant and China's CNPC signed a 30-year contract in Shanghai on May 21 for the shipment of up to 38 billion cubic meters of gas annually to China along the eastern route. Gazprom CEO Alexei Miller did not disclose the gas price to reporters, citing commercial confidentiality, but he said the gas contract with China would be worth a total of $400 billion.

Russian Energy Minister Alexander Novak said after the signing of the contract that the advance on the gas exports to China could be up to $25 billion.

"An advance is envisioned as an option, as a possibility - up to $25 billion. The Chinese side will work out [the possibility of providing an advance] with its other institutions. They are willing and want to, but they have complex decision making procedures," Novak said.

The Russian gas exports to China under the contract could begin in four to six years.

All rights reserved by Rossiyskaya Gazeta.

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