Putting the Power into Siberia

The Gazprom pipeline is seen as critical to Siberia's prosperity and is a vital energy supply to China's thrusting economy and the Russian Far East. 

'Without any exaggeration, we are launching a large-scale strategic project on the global level,' said the Russian president at the ceremony at Us Khatyn village, Yakutsk. 'It is meant to stimulate the development of Eastern Siberia and the Far East and increase Russia's energy security as a whole, strengthen economic cooperation with the governments of the Asia-Pacific Region and, first and foremost, with our key partner China.'

The new pipeline is seen as especially significant with Russia's relations with many Western countries at a low ebb over the Ukraine crisis. The Power of Siberia will have a capacity of 61 billion cubic metres of gas. Gazprom previously signed a $400 billion 30-year contract to supply 38 billion cubic meters of gas per year to China.

The gas pipeline will make it possible 'not only to boost export deliveries and expand the geography of our hydrocarbon exports but also to make another serious step towards developing our country's gas infrastructure, which is especially important for the eastern part'.

Russian president emphasised: 'After we create a network of gas pipelines here, in the Far East and Siberia, we will have the possibility to unite the European part of the gas pipeline system with its eastern part and, from the standpoint of export possibilities and expanding the geography of the country's gas infrastructure development, this will give us big advantages in rechanneling gas flows, depending on the world market situation - either to send more gas to the west and achieve greater effect or to the east.'

Chinese Vice Premier Zhang Gaoli announced at the opening ceremony that his country would begin construction of its part of the Power of Siberia gas pipeline in the first half of 2015. 'The Chinese side has already planned to begin the construction of the Chinese part of the pipeline in the first half of next year,' he said.

'And we must use effort so that we complete construction and the beginning of the pipeline's use in 2018.'

The overall cost is estimated at $20.8 billion, with about $7.5 billion of investment in the Sakha Republic (Yakutia), the capital of which is Yakutsk.