Natural Gas in the Russo-Chinese Relations

The primary objective of the thesis is to analyse gas relations between the two neighbours - Russian Federation with abundant energy resources and energy-hungry People's Republic of China. First negotiations about possible gas supply from eastern Russia to China were already carried out in the middle of 1990s. However throughout the years parties were not able to agree on various conflicting issues which included an origin of supply, a delivery route, and a price formula. Therefore the final agreement between Russian Gazprom and Chinese National Petroleum Corporation was only signed almost twenty years later - in May 2014. According to the contract Gazprom will pipe natural gas from Russia's Far East to China throughout the yet-to-be-built Power of Siberia pipeline. The deal was estimated to be of $400 billion worth and it also prompted much commentary on possible Russian intent to turn East in connection with worsening relations with Western countries. The aim of this thesis is to analyse gas talks in given timeframe and to demonstrate that the agreement is a result of long-term negotiations based on maximisation of benefits rather than hasty decision based on current political situation. The thesis focuses on timeline of gas talks as well as on the conflicting issues