Russia has rejected their plan to pipe oil from Siberia to China

Thursday, November 21, 2019

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Chinese oil industry officials are refusing to believe that Russia has rejected their plan to pipe oil from Siberia into their booming economy, opting instead on a Japanese plan for a pipeline to the Pacific coast. A decision announced by Russian Energy Minister Igor Yusufov on Saturday is reverberating around East Asia as Japan looks to have won the bidding for Siberian oil from the huge Angarsk oilfield. Mr Yusufov said the Russian Government wanted the state-run Transneft to build a 3900-kilometre crude oil pipeline to the Pacific coast near the port of Nakhodka for export to Japan, the US and other customers in the Pacific. Japan has offered $US7 billion ($A9 billion) in finance. A rival proposal backed by Russia's biggest oil company, Yukos Oil, to build a shorter $US2.8 billion pipeline to China's north-east oil centre of Daqing and give China exclusive access to the oil could be abandoned, he said, adding: "China will have equal access to buy oil in the area close to the port of Nakhodka." Mr Yusufov's justification that the decision for the Pacific route was based on purely economic terms will only enrage the Chinese further. The deal will be seen here as Russia's old communist ally being outbid by the still-hated wartime enemy Japan.

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