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Rosneft Ready for Chinese Contract
Chinese Prime Minister Wen Jiabao arrives in Moscow on Monday for meetings with Russian Prime Minister Vladimir Putin. Yesterday, Russian Energy Minister Sergey Shmatko announced yesterday that Rosneft and the Chinese CNPC are on the brink of an agreement on oil deliveries to China. “The companies will sign preliminary documents. We expect the final parameters of the agreement to be agreed upon in the next month or month and a half,” Shmatko said, according to PRIME-TASS. The contract, he added run for no less than 15 years. That is longer than any contract any Russian oil company currently has.
Chinese Deputy Prime Minister Wang Qishan is coming to Moscow tomorrow on the invitation of Deputy Prime Ministers Alexander Zhukov and Igor Sechin. Sechin is responsible for the energy sector in the government and is chairman of Rosneft. The Chinese deputy prime minister is in charge of trade and finance. He will discuss cooperation between the two countries in hydrocarbons and atomic energy.
Rosneft already sells oil to China. It signed a contract with CPNC in 2004 for the delivery of 48.4 million tons of oil by 2010 and received $6 billion in prepayment that went for the purchase of Yuganskneftegaz. It is exporting 8.88 million tons of oil per year to China by rail at the price of Brent crude minus $3. After obtaining five YUKOS refineries, Rosneft informed the Chinese that the contract would have to be renegotiated after 2010. Spring talks were inconclusive. The talks are complicated by the fact that the first line of the East Siberia – Pacific Ocean pipeline will go into service at the end of next year and terminate at Skovorodino, 70 km. from the Chinese border. No fee has been set for transport through the pipeline yet.
www.kommersant.com
All the Article in Russian as of Oct. 24, 2008
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