Beijing and Moscow have finalized an intergovernmental deal under which Russia will supply China with oil for 20 years in exchange for a $25 billion loan to Russia’s state-run energy companies.
Deputy Prime Minister Igor Sechin said the construction of a branch from the East Siberia Pacific Ocean (ESPO) oil pipeline to China could be finished ahead of schedule or before the end of 2010.
Transneft has already started to build the branch. As soon as it is completed, Russia will begin supplying 300 million tons of oil to China. Russia may also consider raising the branch’s capacity above 15 million tons annually.
Russia’s Rosneft and Transneft will receive a $25 billion loan from China secured by the oil supplies. The deal involves a new 67-km spur of the ESPO to connect Skovorodino with China’s border.