China and Russia remain divided over natural gas price

18th November 2010, Comments 0 comments

Beijing hopes to resolve differences over the price of natural gas Moscow wants to sell its energy-hungry neighbour, during Premier Wen Jiabao's visit to Russia next week, an official said Thursday.

"The two sides have made a lot of efforts but we are still largely divided on pricing," Gu Jun, deputy director-general of the National Energy Administration's international department, told reporters.

"As far as I know the difference between the two sides is now 100 dollars for 1,000 cubic metres."

China hoped that both sides would be able to "push forward the negotiations," Gu said at a briefing ahead of the November 22-24 visit to Russia by Wen, Vice Premier Wang Qishan and other officials.

Wen is due to hold talks with his Russian counterpart Vladimir Putin before travelling to Tajikistan for the Shanghai Cooperation Organisation (SCO) meeting on November 25.

The SCO is a grouping of mostly central Asian states that many view as a bid by China and Russia to counter global US influence.

Russia's Gazprom, the world's largest gas producer, signed a framework agreement with China National Petroleum Company last year that could see about 70 billion cubic metres of natural gas sent to China annually.

While the two sides have yet to sort out a final pricing mechanism, Russian Deputy Prime Minister Igor Sechin, the country's powerful energy czar, said in September the deal would be signed by mid-2011, with first deliveries in 2015.

"The pricing gap is an important part of Vice Premier Wang Qishan's visit to Russia and we hope to narrow the gap between the two sides," Gu said.

Relations between Moscow and Beijing -- once bitter foes during the Cold War -- have a turbulent history, but have improved dramatically in recent years.

Both countries view themselves as counterweights to US global dominance, but Moscow has viewed China's rapid economic rise with some unease.

© 2010 AFP

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