Platts: China-Russia pipeline deal to shape global LNG prices: Tokyo Gas official
The deal between Russia and China for importing some 38 billion cubic meters/year of natural gas through a pipeline connecting the two countries represents a key development not only for the two parties involved, but also for the role it will have in shaping the global price of LNG, according to Shigeru Muraki, vice chairman of the board at Japan's Tokyo Gas.
Speaking at the Adam Smith Sakhalin Oil and Gas 2014 conference in the Russian Far East late Wednesday, September 24, Muraki said that the many LNG export projects coming on stream in the next years in countries such as Australia, Russia and the US will not only have to compete between each other for demand, but also against the price set by pipeline imports deals such as the one between Russia and China, which has an estimated price of around $12/MMBtu.
Russia is set to export up to 38 Bcm/year of natural gas from fields in East Siberia to China over a 30-year period starting after 2018 through the Power of Siberia pipeline, of which construction started earlier in September.