China 'compelled' to ally with Russia amid Ukraine war says Leoni
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Since the start of Russia’s invasion of Ukraine, Putin’s war has been bankrolled by Moscow’s massive oil and gas supplies, particularly to Europe. However, as European Union leaders started looking for ways out of this reliance on Russian natural gas, Putin began increasing his exports to China, even signing a 30-year gas deal with a new pipeline.
But now it seems like China is not interested in relying on being wholly reliant on Russia for its fossil fuel supply, as state-backed PetroChina struck a major deal to import millions of tonnes of Liquified natural gas (LNG) from the US every year for decades.
Stephen Stapczynski of Bloomberg tweeted: “China just signed ANOTHER deal to purchase LNG from the US
“Cheniere will supply PetroChina with as much as 1.8 million tons a year to 2050. Initial supply will start in 2026
“Well over a dozen LNG deals have been signed between the US and China in the last year.”
He then added: “US-Europe LNG deals? There have been a few, but not nearly as much as US-China LNG deals.”
A deepening relationship between the US and China could spark fears in the Kremlin that China may not support Russia’s aggression in Ukraine for fear of jeopardizing these gas deals with the US.
China has taken a strictly neutral stance on Russia’s invasion of Ukraine, refusing to condemn Putin’s actions, and opposing economic sanctions against Russia.
Just a few weeks before the invasion, Russia agreed on a 30-year contract to supply gas to China via a new pipeline, settling the sales in Euros.
According to a Beijing-based industry official, the Russian state-backed gas behemoth Gazprom, which has a monopoly on Russian gas exports by pipeline, has agreed to supply Chinese state energy major CNPC with 10 billion cubic metres (bcm) of gas a year.
Speaking on the latest LNG deal with the US, Jack Fusco, Cheniere’s President and Chief Executive Officer said: “We are pleased to build upon our existing and successful long-term relationship with PetroChina and sign our first LNG contract that crosses over into the second half of this century.
“PetroChina is a leading energy company in one of the largest and fastest-growing markets for LNG.
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“This SPA increases Cheniere’s long-term sales to PetroChina to approximately 3 million tonnes per annum, and we are proud to support China’s progress toward a lower-carbon future with our reliable, cleaner-burning LNG.”
Commenting on the agreement, Mr Tian Jinghui, Executive Chairman of PCI stated “Natural gas continues to play a vital role in enabling energy transition in China.
“We are pleased to further expand our cooperation with Cheniere in delivering LNG, one of the cleanest fuel choices to our millions of customers for many years to come.”
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