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Hong Kong investor buys 51% of East Siberian gas field developer

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A Russian-Chinese investment energy company, a subsidiary of the Hong Kong-registered RusEnergy Investment Group, has bought 51% of Russia's Suntarneftegaz, a Chinese newspaper said on Monday.

BEIJING, October 12 (RIA Novosti) - A Russian-Chinese investment energy company, a subsidiary of the Hong Kong-registered RusEnergy Investment Group, has bought 51% of Russia's Suntarneftegaz, a Chinese newspaper said on Monday.

Suntarneftegaz holds licenses for the Yuzhno-Berezovsky and Cheredeisky fields in Eastern Siberia with aggregated natural gas reserves of 60 billion cubic meters.

The Zhongguo Caijing newspaper did not name the figures involved in the deal. Suntarneftegaz was unavailable for comment.

The newspaper said this was the first joint project between the two countries in oil and following their signing of a deal on cooperation in the natural gas sphere during Chinese President Hu Jintao's visit to Russia in June. The deal allows for the first time international companies to produce gas in Russia.

"The deal creates a new model in Russian-Chinese energy cooperation," the newspaper said, adding that the RusEnergy Investment Group intended to invest $300 million in the deposits within the next two years. The gas from the deposits will be exported to China, Japan, South Korea and Singapore.

The report on the deal appeared a day after the fifth round of Russian-Chinese energy talks was held in China's capital Beijing. Russia was represented by Deputy Prime Minister Igor Sechin, and China by deputy premier Wang Qishan.

In April, during the fourth round of the talks in Beijing, the two countries signed an intergovernmental agreement on cooperation in the oil sphere for the next 23 years.

In October 2008, Russia and China reached an agreement to build a Chinese leg of the East Siberia-Pacific Ocean (ESPO) oil pipeline, which is designed to pump up to 1.6 million barrels of crude per day from Siberia to Russia's Far East and to energy-hungry China and the Asia-Pacific region. Construction is underway and is expected to be completed by late 2010.

Russia and China are members of the Shanghai Cooperation Organization (SCO), founded in 2001, together with ex-Soviet Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan.

A meeting of the SCO Council of heads of government will take place in Beijing on October 14. Russian Prime Minister Vladimir Putin will attend.

 

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