Gazprom and CNPC Sign Siberia-2 Gas Pipeline Deal

The 'Power of Siberia-2' pipeline represents a major development in regional energy infrastructure. The agreement was formalized in September 2025 following a prolonged period of diplomatic and commercial discussions. Gazprom, the Russian state-controlled energy corporation, and CNPC, the Chinese national oil company, are the primary entities driving this initiative.

The core of the deal involves the physical construction of a pipeline capable of transporting massive quantities of natural gas. Specifically, the infrastructure will support a flow of 50 billion cubic meters per year. This volume highlights the scale of the project and its importance to the energy security of the receiving nation.

The geographical path of the pipeline is a critical component of the agreement. The gas will not travel directly across the Russian-Chinese border but will instead transit through Mongolia. This route leverages Mongolia's strategic position between the two giants, potentially offering economic benefits to the transit country while securing a stable delivery path for China.

The completion of this link will solidify energy ties between Russia and China. It diversifies Russia's gas export routes away from Western markets and enhances China's access to energy resources from its northern neighbor. The project signifies a deepening of the strategic partnership between the two countries.

Despite the finalization of the memorandum, the road to this point was not immediate. The source material indicates that the two sides had been discussing the project for several years. The timeline suggests that the technical and logistical aspects of the pipeline were likely established early, but commercial terms remained a sticking point.

The primary factor slowing progress was identified as the price of the gas. Contractual pricing is often the most contentious issue in long-term energy deals, balancing the supplier's revenue needs against the buyer's market rates. The resolution of this pricing dispute was the key to unlocking the agreement in September 2025.

The signing of the memorandum between Gazprom and CNPC serves as the definitive signal that the 'Power of Siberia-2' project is moving forward. By addressing the long-standing issue of gas pricing, the parties have removed the primary obstacle that had previously impeded the project. The agreement sets the stage for the construction of a vital energy artery that will deliver 50 billion cubic meters of Russian gas to China via Mongolia. This development marks a new chapter in the energy relationship between the two nations, with significant implications for the regional energy landscape.