Putin hails China ties at oil pipeline completion

MOSCOW, Aug 29 (BestGrowthStock) – Russian Prime Minister Vladimir
Putin on Sunday opened a pipeline branch to carry Siberian oil
to China and hailed Russia’s energy business in China as an
important counterweight to its traditional European clients.

Putin was speaking in the town of Skovorodino, the end of
the pipeline to the Pacific region, in honour of the completion
of a branch that will carry Siberian oil to the Chinese town of
Daqing from the end of the year. PetroChina is the importer.

“This is an important project for us because we are starting
to diversify sales of our energy resources. To this day the main
deliveries are to our European partners. They get around 120-130
million tonnes of our oil today,” Putin said on Russian radio.

Russia’s relationship with Europe is especially uneasy on
the energy front since gas supplies were cut in the dead of
winter during a spat with Ukraine, a key transit country, over
gas non-payments.

European efforts to diversify energy supplies have been met
by Russian declarations of independence from its traditional
Western client base, and demand is soaring in China, Moscow’s
traditional political counterweight to the West.

SIGNIFICANT COMPETITION

Putin said when physical deliveries begin, Russia will pump
at a rate of 30 million tonnes per year. Further expansion will
bring deliveries to 50 million tonnes, he said.

“This is already significant competition for the European
route.”

Russia inaugurated the East Siberia-Pacific Ocean pipeline
in December, giving the world’s largest exporter a geographical
and advantage over Asia’s key Middle Eastern suppliers on
deliveries to China, Japan and South Korea.

The new outlet has even helped Russia to increase its
deliveries to the United States. Shipments of the ESPO-blend
crude move regularly to the U.S. West coast.

ESPO barrels are currently unloaded onto rail cars at
Skovorodino and shipped to the Pacific port of Kozmino.

Last week, as the blend was selling at record high prices,
China made its second known purchase of ESPO crude.

(Writing by Melissa Akin; Editing by Angus MacSwan)

Putin hails China ties at oil pipeline completion