Active Conflicts & News Megathread September 01, 2025

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[u/teethgrindingaches]

Gazprom caught a break today with the signing of Power of Siberia 2. Took them a decade of painstaking negotiations with CNPC, but the 50 billion cubic metre pipeline is finally going forward.

Russia's energy giant Gazprom and China's state-owned CNPC signed a binding agreement on Sept. 2 to build the Power of Siberia-2 pipeline, set to deliver gas from Russia's Yamal fields to China via Mongolia for 30 years, Gazprom CEO Alexei Miller announced. The deal, long delayed by Beijing's hard bargaining over prices and volumes, cements Moscow's pivot to Asia as it loses access to European energy markets. Supplies through the new route are expected to reach 50 billion cubic meters annually.

Moscow and Beijing also agreed to boost deliveries through the existing Power of Siberia line from 38 to 44 billion cubic meters per year. Miller announced the breakthrough after trilateral talks in Beijing between delegations from Russia, China, and Mongolia. "This will be the largest, most ambitious, and most capital-intensive gas project in the world," he said.

The exact price was not specified, but Bloomberg says it's lower than what Europe is paying (which shouldn't come as a surprise). CNPC has long been holding out for preferential rates; whether Gazprom caved or whether they accepted higher prices at Beijing's order is anyone's guess.

EDIT: Take this with some hefty salt, but rumour has it that CNPC was previously wary of US sanctions w.r.t. committing to such a big project. CNPC being a fuckoff huge SOE and one of the biggest oil companies in the world means that sanctions (if rigorously enforced) would have major political and economic fallout. Note that last week saw the first sanctioned Russian LNG tanker dock at a Chinese port, a tanker which set sail literally hours after Trump met Putin in Alaska the week prior. Fertile ground for all sorts of rumours, obviously. Make of that what you will.

[u/Infamous-Salad-2223 → u/teethgrindingaches]

So, I heard months ago it was kinda dead cause China wanted cheaper gas prices and Gazprom was not having it given the cost of the project, so I guess they compromised?

Is it known the estimate of what the gas sell price should be to recoup the expenses in let's say a few years?

[u/PaxiMonster → u/Infamous-Salad-2223]

It's kind of hard to say, because the contract hasn't actually been signed, the price of deliveries hasn't been disclosed, and it'll actually take until the early 2030s to reach design transfer capacity, so "a few years" is way into the future (POS-1 was opened in 2019 but I don't think it reached full operational capacity until this year?)

The agreement for POS-2 is on 30 years at a projected transfer volume of 50B m3/year. That's more than the current POS-1, on a shorter route, but construction and exploitation might be more expensive, so amortization periods would be comparable. Not that it means much, since as far as I know that data isn't available for POS-1, either, but in any case, it's not construction cost and amortization that were the main blockers of POS-2 so far, it was disagreements over gas price.