Wedoany.com Report-Sept. 3, On Tuesday, September 2, 2025, Gazprom announced that Russia and China signed a legally binding memorandum to construct the Power of Siberia 2 pipeline, which will transport up to 50 billion cubic meters (bcm) of natural gas annually from Russia’s Yamal Arctic fields to China via Mongolia. The agreement was finalized in Beijing during meetings involving Russian President Vladimir Putin, Chinese President Xi Jinping, and Mongolian President Ukhnaagiin Khurelsukh.

Model of natural gas pipeline and Gazprom logo, July 18, 2022.

Gazprom CEO Alexei Miller stated: “This will now be the largest, most ambitious and most capital-intensive project in the global gas industry.” The pipeline is designed to enhance China’s energy options by providing access to significant gas reserves. Additionally, an agreement was reached to increase gas supplies through the existing Power of Siberia pipeline, which extends from Eastern Siberia to China, from 38 bcm to 44 bcm per year. A separate deal will boost supplies from Russia’s Sakhalin Island to China from 10 bcm to 12 bcm annually.

Pricing details for the Power of Siberia 2 pipeline remain under negotiation, with Miller noting: “The price of gas supplied via the new pipeline will be agreed separately.” He added that the cost would be lower than prices charged to European buyers due to the shorter distances involved. Michal Meidan, head of China Energy Research at the Oxford Institute for Energy Studies, remarked: “Announcements about Power of Siberia 2 are a huge turning point in the geopolitics of energy.”

Kirill Babaev, head of the China and Contemporary Asia Institute in Moscow, commented: “The big deal is finally under way.” He highlighted that while commercial terms like pricing and subcontractors are still pending, the project has received high-level approval from leaders in Russia, China, and Mongolia, paving the way for further progress.

The project, which will connect Russia’s Bovanenkovo and Kharasavey gas fields to China through Siberia and Mongolia, is described as one of the world’s most extensive and costly gas infrastructure initiatives. Alongside this, 22 cooperation agreements were signed between Russia and China, including a strategic partnership between Gazprom and China National Petroleum Corporation. The Power of Siberia 2 pipeline supports the growing energy trade between Russia and China, with China being a major buyer of Russian gas, crude, and coal.