Gazprom, CNPC sign basic terms for gas supplies
BY JAMES MARSON
MOSCOW -- Gazprom has signed an agreement on the basic terms of gas supplies with China National Petroleum Corporation, but the two sides have yet to agree on a price, a spokesman for Gazprom said.
The heads of the two companies signed the agreement for Gazprom to deliver 38 Bcmpa and have agreed on the route, the level of guaranteed volumes CNPC must pay for, and the speed at which supplies will be ramped up, Gazprom said in a statement.
Gazprom has said it wants to finalize a supply deal by the end of the year.
The Russian firm has for years sought to reach a deal to sell gas to China, but talks have been hobbled by disagreements over price and potential routes. Gazprom wants to boost supplies to Asia amid stagnating demand and regulatory pressure in its most lucrative European market.
Gazprom said in its statement that the prices will not be linked to the United States benchmark Henry Hub. Gazprom favors contracts linked to the price of oil.
A spokesman for Gazprom, Sergei Kupriyanov, said the sides hadn' t yet agreed on the price for supplies. He said, however, that "some progress" had been made in talks, without elaborating.
Dow Jones Newswires