Gazprom Signs Euro 2 bn Loan Agreement with Bank of China

Gazprom and Bank of China, London Branch on Thursday entered into a five-year 2 billion Euro ($2.2 bn) loan facility agreement.

The agreement was signed in Shanghai by Gazprom's Deputy Management Committee Chairman Andrey Kruglov and Deputy General Manager of Bank of China, London Branch, Wang Huabin.

For Gazprom this is the largest deal in terms of the amount of financing attracted directly from one financial institution and the first bilateral loan facility agreement with a Chinese bank.

Andrey Kruglov and Gao Yingxin, Bank of China Executive Vice President discussed the prospects for deeper cooperation between Gazprom and Bank of China.

Gazprom has been closely working with Chinese state owned behemoth CNPC for construction of gas pipelines to bring Russian gas China. On May 21, 2014 Gazprom and CNPC signed the Sales and Purchase Agreement for the Russian gas supply via the eastern route (Power of Siberia gas pipeline). The 30-year contract provides for gas supplies to China in the amount of 38 billion cubic meters of gas per year.

On May 8, 2015 Gazprom and CNPC inked the Heads of Agreement for pipeline gas supply from Russia to China via the western route. Initially, 30 billion cubic meters of gas a year are due to be delivered to China from Western Siberian fields.