Russia’s Rosneft to boost oil supplies to China

PanARMENIAN.Net - Russia’s state-owned oil giant Rosneft may increase oil supplies to China by over 9 million metric tons, Deputy Prime Minister Arkady Dvorkovich said on Monday, Feb 25, according to RIA Novosti

The extra oil will help supply a projected joint refinery project in the Chinese city of Tianjin in northern China, the deputy premier said.

“So far, specific parameters have not been defined, but in any case deliveries should be sufficient to implement the Tianjin refinery project. This is about 9 million tons of oil and the Chinese side is interested in an even larger increase in deliveries,” Dvorkovich said after a meeting of the Russian-Chinese commission for energy cooperation in Beijing.

Rosneft spokesman Vladimir Tyulin said last week Rosneft had agreed to boost crude supplies to China but declined to specify the amounts involved or delivery routes.

Rosneft and oil pipeline monopoly Transneft currently deliver 15 million tons of crude to China annually via a Russia-China branch of the East Siberia–Pacific Ocean pipeline under a deal signed in 2009. Deliveries started in 2011. In return for long-term crude supplies, Rosneft received $15 billion and Transneft $10 billion in loans from Chinese banks in 2009. At current prices, 9 million tons of oil would be worth around $6 billion.

Rosneft is once again cash-hungry as it absorbs the cost of buying up TNK-BP, the Russo-British joint venture, which is costing it over $50 billion.

China has said on numerous occasions it wants more Russian oil.

Rosneft has also started talks with potential Chinese partners on their participation in the development of the Russian Arctic shelf, which is a promising area for bilateral cooperation, Dvorkovich said.