CHU LIN (China)

Graduate student

Saint Petersburg State University

Keywords: China, Russia, energy cooperation, energy security, strategic partnership

In recent decades, energy issues have occupied one of the most significant places in modern world politics. This industry is important both for the Chinese economy, which is at a key stage of urbanization and industrialization of the country, and for Russia, which is striving to make it an engine of innovative economic development.

China and Russia are interested in strategic cooperation in the energy sector, especially in the oil and gas sector. Its fundamental basis, as in other areas, was the "Treaty on Good-Neighborliness, Friendship and Cooperation between the Russian Federation and the People's Republic of China", which was signed by the two heads of state on July 16, 2001. Cooperation in the energy sector also contributes to strengthening the long-term strategic partnership between the two countries, and in general in the Asia-Pacific region (APR).

MUTUAL INTEREST

According to the forecast of the International Energy Agency, the world's demand for energy resources will increase by a third by 2035, and 60% of the increase will fall on China, India and some countries of the Middle East, including oil producers [1].

In 2010, China for the first time surpassed the United States and became the largest energy consumer in the world [2]. The strategy for ensuring China's energy security involves improving energy efficiency, expanding the national resource base, developing new energy resources, centralizing the management of the energy industry and planning with the gradual introduction of market elements of management, etc. In addition to these domestic measures, China actively uses economic and political tools in the external energy markets: for example, the creation of its own system of energy imports, economic assistance (lending) in exchange for energy resources. The goal of China's external energy strategy is to create a reliable energy supply system that can fill the ever-widening gap between supply and demand and ensure the country's energy security.

The "Energy Strategy of Russia for the period up to 2020" states that energy is the basis of Russia's economic development and a tool for implementing domestic and foreign policy goals: "The goal of energy policy is to maximize the effective use of natural fuel and energy resources and the potential of the energy sector for economic growth and improving the quality of life of the country's population. Russia's cooperation with other countries in the field of energy always follows the principle of maximizing the national interests of its country, and also seeks to obtain the largest political and economic benefits through "energy diplomacy" [3].

Energy cooperation between China and Russia has a strong legal framework and is in line with the strategic interests of ensuring the energy security of the two countries. China is currently at a key stage of urbanization and industrialization as part of its ongoing economic transformation. And in the coming years, China needs to ensure that its energy demand is consistently met. At the same time, there are structural problems in the energy sector, and as a result, dependence on energy imports is increasing.

Russia is one of the most important energy exporters in the world. Export of resources and development of the energy industry play an important role in the modernization of the country. However, Russia has been dependent on the European market for many years and needs to diversify its exports.

Thus, there is a great complementarity between Russia and China in the energy sector. Cooperation between the two countries in this area has become one of the priority areas of mutually beneficial strategic cooperation.

On March 22, 2013, Chinese President Xi Jinping and Russian President Vladimir Putin signed the "Joint Statement of the People's Republic of China and the Russian Federation on Mutually Beneficial Cooperation and Deepening of Comprehensive Partnership and Strategic Cooperation"in Moscow. The document sets out the positions of China and Russia on bilateral strategic cooperation and important international issues. The joint statement said: "Relations between Russia and China have reached an unprecedented high level and have become an example of harmonious coexistence

great Powers that play an essential stabilizing role in the modern world order and contribute to strengthening peace and security in the region and the world as a whole. Cooperation in the energy sector, including in the oil, gas, and coal industries, as well as in the electric power industry and the use of alternative energy sources, has intensified. Strong relations of Russian-Chinese strategic cooperation in the energy sector have been formed... " [4]. During the visit of the new President of the People's Republic of China Xi Jinping to Russia, a number of energy documents were signed, according to which the annual volume of Russian oil supplies to China in the future is planned to increase by 4 times [5].

In October 2013, the Prime Minister of the Russian Federation Dmitry Medvedev Medvedev held talks with Premier of the State Council of the People's Republic of China Li Keqiang in Beijing. The energy agreement was the most important aspect of the package of 21 documents approved by the parties. The Heads of Government highly appreciated the results of energy cooperation between the two countries and expressed their readiness, guided by the principles of mutual benefit, mutual favorability and mutual trust, to continue strengthening and developing comprehensive strategic cooperation in the energy sector in order to ensure the conversion of the achieved level of political relations into tangible results of practical cooperation in the energy sector [6].

Cooperation between China and Russia in the energy sector contributes to the political and economic development of the two countries. Igor Sechin, Co - Chairman of the Russia-China Energy Dialogue and Deputy Prime Minister of the Russian Federation, noted:: "Energy cooperation between China and Russia effectively enriches the content of relations of strategic partnership and interaction, increases the level of the entire complex of interaction between the two countries" [7].

THERE ARE ALSO PROBLEMS

Energy cooperation between China and Russia has great prospects, but there are also some problems, which, in particular, highlighted the protracted negotiations on gas supplies between Gazprom and the China National Petroleum Corporation (CNPC), especially the twists and turns of the issue of building a gas pipeline along the eastern route.

Chen Shuyan, a Chinese expert, argues that a proper strategic approach to energy cooperation between China and Russia is insufficient [8]. It is echoed by Russian experts: "To a greater extent, there is an underestimation of strategic prospects, from the point of view of long-term state interests of the Russian Federation, and the predominance of short-term and narrow-corporate interests. At the same time, the tasks of Russian-Chinese energy cooperation are mainly focused on extracting commercial profits from raw materials corporations" [9].

However, such statements relate primarily to the long - standing history of changing the construction project of the Eastern Siberia-Pacific Ocean (ESPO) oil pipeline. In November 1994, CNPC and the Siberian Far Eastern Oil Corporation of Russia signed a "Memorandum of Negotiations", which noted the need to build an oil pipeline from Angarsk to Daqing, also known as the"Southern Line". In July 2001, the intergovernmental agreement "On the basic principles of developing a feasibility study for the Russia-China oil Pipeline" (Angarsk-Daqing) was also signed. But, according to Chinese experts, in the second half of 2002, the Japanese intervened in the implementation of this project, proposing the Northern Line project: the Angarsk - Nakhodka pipeline. As a result, the decision on the supply of hydrocarbons to China via the pipeline was delayed for several years.

Both Russia and China are large countries with their own geopolitical interests. They are not only partners, but also competitors. Therefore, in the sphere of energy cooperation between them, there is sometimes a lack of trust in each other [10].

China has well-established diversified sources of energy imports, and in this respect is not very dependent on Russia, which reduces the guarantees of ensuring long-term demand for such resources from China. So, China imports liquefied natural gas (LNG) from Australia, Qatar and Nigeria, and is working on a gas supply project from Myanmar. China and Central Asian countries have already started construction of the China - Kazakhstan oil pipeline and the Central Asia-China gas pipeline. China hopes to achieve energy diversification [11].

Russia, on the other hand, is trying to avoid excessive dependence on the Chinese energy market in Northeast Asia, hoping for cooperation with both China, Japan and South Korea. Russia is interested in developing the Far East and Siberia in order to meet Asian demand, which is growing rapidly.

There were also discrepancies regarding gas supply routes.

The Russian side was interested in laying, first of all, a Sino-Russian gas pipeline from Western Siberia to the Altai gas pipeline on the Chinese border, while the Chinese side sought to accelerate the construction of a gas pipeline along the eastern route from Yakutia to Khabarovsk and Vladivostok[12].

COOPERATION IS GAINING MOMENTUM

In recent years, there has been a major shift in energy cooperation between the two countries and the solution of existing problems.

In February 2009, the Chinese government agreed to provide $25 billion. Rosneft and

"Transneft" in exchange for a guaranteed supply of 15 million tons of oil per year for 20 years. In January 2011, the Sino-Russian cross-border oil pipeline running from Skovorodino (Russia) before Daqing (China), it was put into official commercial operation. It is a branch of the Eastern Siberia - Pacific Ocean (ESPO) oil pipeline.

Rosneft of Russia and CNPC have started construction of an oil refinery in China. In September 2010, a groundbreaking ceremony was held in Tianjin to lay the foundation stone for the plant to be built by the China-Russia Eastern Petrochemical Company (Vostok-Petrochemistry) joint venture.

During the St. Petersburg International Economic Forum 2013 in June 2013, Rosneft signed an agreement with CNPC to expand Russian oil supplies from 15 million tons annually for 20 years to another 360 million tons over 25 years (approximately 14.4 million tons per year) with an advance payment of $60 billion. [13].

In January 2014, Rosneft received the first tranche of prepayment from CNPC. Prepayment is provided in accordance with the terms of long-term oil supply contracts signed by Rosneft and CNPC in June 2013 as part of the implementation of the Agreement between the Government of the Russian Federation and the Government of the People's Republic of China on Expanding Cooperation in Crude Oil Trade dated March 22, 2013. Igor Sechin, President of Rosneft, said: "We are grateful to the country's leadership for supporting our projects. Strategic cooperation with CNPC is developing in a spirit of partnership and in full compliance with the agreements reached. Our company will supply about 360 million tons of oil to China within 25 years. In 2013, the volume of deliveries amounted to about 800 thousand tons of oil. In 2014, deliveries are carried out according to the schedule agreed between the parties using the ESPO system and transit through the territory of Kazakhstan. In particular, deliveries via the route through Kazakhstan began on January 1, 2014. In addition, work continues on joint projects in the field of production and processing" [14].

On September 5, 2013, in the presence of Russian President Vladimir Putin and Chinese President Xi Jinping, NOVATEK, the largest Russian independent gas producer, and CNPC signed a purchase and sale agreement to acquire a 20% stake in the Yamal LNG project from CNPC. The Chinese side will also assist in attracting external financing for the project from Chinese financial institutions. Zhou Jiping, Chairman of the Board of Directors of the Chinese Corporation, said: "We are satisfied with the progress of our cooperation. The signed agreement is an important step in the development of energy projects that will contribute to the reliable supply of environmentally friendly energy resources to the fast-growing economy of the People's Republic of China "[15].

In January 2014, NOVATEK closed the sale of 20% of Yamal LNG to a subsidiary of CNPC. Now the shares of Yamal LNG shareholders are: NOVATEK-60%, Total-20%, CNPC-20%. NOVATEK estimates the total capital investment in the Yamal LNG project at $26.9 billion. The project also provides for the construction of an LNG production plant with a capacity of 16.5 million tons of LNG per year on the resource base of the Yuzhno-Tambeyskoye field, as well as the creation of transport infrastructure, including a seaport and airport near the village of Sabetta (north-east of the Yamal Peninsula). The first LNG production line under the Yamal LNG project will be launched in 2017. It is planned to conclude a long-term contract for the supply of at least 3 million tons of LNG per year to the Chinese side [16].

On October 22, 2013, in the presence of Russian Prime Minister Dmitry Medvedev and Premier of the State Council of the People's Republic of China Li Keqiang, Sinopec Chinese Petrochemical Corporation signed a memorandum on an export contract with Rosneft on prepayment terms [17]. Rosneft and Sinopec expect to make a final joint investment decision on the implementation of the Tianjin Oil Refinery project in early 2017. Commissioning of the enterprise is scheduled for no later than 2020 [18].

The memorandum provides for oil supplies in the amount of up to 100 million tons over 10 years, starting in 2014, on prepayment terms. The Memorandum also provides for the possibility of partial replacement of oil with petroleum products. The parties will hold negotiations on the price of crude oil. Igor Sechin noted: "The agreements reached today indicate the systematic development of large-scale cooperation with our Chinese partners. This agreement will allow Rosneft to attract additional financing for the implementation of projects in the field of exploration and production, as well as for the construction of the necessary infrastructure" [19].

GAS PRICE-THAT'S THE QUESTION

Progress has been made in the negotiations on the construction of gas pipelines along the eastern route, which last more than 10 years, and in the framework of the Altai project.

After lengthy and difficult negotiations, Russia's Gazprom and CNPC signed a gas deal in late 2009 that could make China the largest consumer of Russian natural gas. In 2010, Gazprom and CNPC agreed, starting in 2015, to supply gas via the Altai pipeline, which had been constructed by that time, and via the eastern route (from Irkutsk) (map 1) [20].

The Eastern gas program includes:

1. Yurubcheno-Tokhomskoye field (reserves - 700 billion cubic meters). m); 2. Sobinsko-Paiginskoye (70 billion cubic meters). 3. Kovyktinskoye field (2000 billion cubic meters). 4. Chayandinskoye field (1240 billion cubic meters). 5. Sakhalin I-II (900 billion cubic meters). 6. Promising areas of the Sakhalin shelf.

Map 1. Eastern Gas program: fields and pipelines.

There was also a major stumbling block-the question of the price of gas. China, based on the price of liquefied natural gas (LNG) and coal purchased, expects a price significantly lower than the market price: $235 (no more than $250) per 1 thousand cubic meters of gas. The Russian side insists on $350 per 1 thousand cubic meters [21].

The gas price problem is affected by several factors.

The discovery of new large gas fields in China in recent years has reduced the acute shortage of this fuel. In addition, China's dependence on gas imports from Russia has been reduced by the diversification of natural gas supplies from other countries of the world: China has built gas pipelines from Turkmenistan and Myanmar, and also imports LNG from Australia, Qatar and Nigeria. The presence of large coal reserves and progress in the production of alternative energy sources in China also affect the situation on the gas market [22].

In March 2013, Gazprom and CNPC signed a "Memorandum of Understanding on cooperation in the project of pipeline supplies of Russian natural gas to China". According to the head of the Russian holding A. Miller, Gazprom will be able to receive an advance payment from China for gas supplies via the branch from the Power of Siberia gas pipeline, which are planned to start in 2018 in the amount of 38 billion cubic meters. m per year with a possible growth of up to 60 billion cubic meters" (taking into account possible LNG supplies from the Vladivostok plant).

Power of Siberia (map 2) will become a common gas transmission system for the Irkutsk and Yakutsk gas production centers and will transport gas from these centers through Khabarovsk to Vladivostok. At the first stage, the main gas pipeline "Yakutia - Khabarovsk - Vladivostok" should be built, and at the second stage, the Irkutsk center will be connected with-

Map 2. The Power of Siberia gas pipeline.

Источник: http://www.gazprom.ru/about/production/projects/pipelines/ ykv/

It is connected by a gas pipeline to the Yakut center.

A strong resource base in the East of Russia, the consistent formation of large gas production centers and the creation of necessary transport corridors will make it possible to organize a new center for Russian gas export supplies focused on the Asia-Pacific region [23].

In January 2014, following a working meeting between Alexander Miller, Chairman of the Gazprom Management Committee, and Zhou Jiping, Chairman of the Board of Directors of CNPC, Gazprom announced that Gazprom's contract for gas supply to China via the eastern route will enter into force by the end of 2014. At the meeting, it was proposed to prepare the contract for signing during the visit of the Russian President to China, scheduled for May 2014 [24].

After the talks between President Vladimir Putin and President Xi Jinping of the People's Republic of China in Sochi in February 2014, Russian Presidential press Secretary Dmitry Peskov said: Peskov confirmed that "on gas, the parties expect that by May they will be able to finalize the negotiation procedures on prices" [25].

* * *

The formation of a solid and long-term foundation for the strategic political and economic partnership between China and Russia in the field of energy is gaining momentum. It is supported by a balanced approach to the interests of both sides in this area and further strengthening of the strategic partnership between the two countries, which provides broader support for the energy dialogue between China and Russia.

There are some problems in energy cooperation between Russia and China. But in the short term, when the construction of the main gas pipeline from Russia to China begins, there will be a great demand for high-quality equipment for the pipeline, which will significantly raise the situation in this market and will contribute to the development of energy companies in both countries. In the long term, China-Russia cooperation in the energy sector will further develop and deepen the strategic partnership between the two countries in the economic and political spheres in the 21st century.

The completion of oil and gas pipelines and the start of major energy supplies from Russia to China play an important role in ensuring China's energy security. For the Russian economy, the development of energy cooperation with China can bring trade benefits. Finally, according to Sergey Zhiznin, President of the Russian Center for Energy Diplomacy and Geopolitics, "by implementing large-scale, China-oriented international energy projects in the Far East, Western and Eastern Siberia, Russia can attract solid foreign investment, which will make it possible to develop not only the fuel and energy sector, but also social and transport infrastructure in Russia." these regions of Russia" [26].

1. World Energy Outlook, 2012, p. 1 // International Energy Agency - http://www.iea.org/termsandconditionsuseand-copyright/Executive Summary 1

2. World Energy Outlook, 2010, p. 87 // International Energy Agency - http://www.worldenergyoutlook.org/media/ weo2010.pdf

3. http://www.cpnt.ru/userfiles/_files_normativ_energosaf e energostrategy.pdf

4. http://президент rf/ref_notes/l423

5. http://russian.china.org.cn/exclusive/txt/2013-04/10/content_28503774.htm

6. http://russian.people.com.cn/31521/8433565.html

7. http://minenergo.gov.ru/china/

8. Chen Shuyan. Qian si e zhu shi dui zhong e neng yuan he zuo guang si de ying xiang di dui tse (Analysis of the impact of Russia's entry into the WTO on Chinese-Russian cooperation in the energy sector) / / Zhongguo wai ji, 2012, N 10.

9. Paramonov V., Strokov V. Sovremeynniy format rossiysko-kitayskogo energetiches-kogo sotrudnichestva: osnovnoe problemi i perspektivy / / Vremya Vostok, 09.07.2012 (in Russian)

10. Song Yongxiang. E lo si nan yuan bu meng 2010 nian fa Zhan Zhuang Kuang di jin qi qian jing feng xi (State and prospects in the energy sector of Russia) / / Zhongguo jing di dao bao, 06.01.2011, N 2, pp. 65-67.

11. Wang Haiyun. Zhong e nan yuan he cho de yu li yin su yu zhi yue yin su (Favorable and limited factors of China-Russia cooperation in the energy sector) // E lo si xue kang, 2012, N 3, pp. 5-10.

12. Liu Zengjie. 2009 nyan e lo xi tian zhan qi ji yuan di gong Xu Xing Shi (Demand and prospects of gas resources of Russia in 2009) / / Ministry of Land and Natural Resources of the People's Republic of China, 09.26.2010.

13. http://xn -90aoqlh7c4a.xn -dlabbgf6aiiy.xn - plai/%D0%BD%D0%BE%D0%B2%D0%BE%Dl%81%Dl%82 %D0%B8/18375

14. http://www.rosneft.ru/news/pressrelease/15012014.html

15. http://www.novatek.ru/ru/press/releases/index.php7id 4=783

16. ITAR-TASS, 14.01.2014.

17. http://russian.people.com.en/31518/8434817.html

18. http://energy.people.com.cn/n/2013/1023/c71661-23302443.html

19. http://www.rosneft.rU/news/pressrelease/221020132.h tml

20. Lee Lifan. Zhong e nan yuan he cho de di yu yu wen ti (Opportunities and challenges of China-Russia energy cooperation) // I zhou ting di zhou kang, 2013, N 11, pp. 79-88.

21. http://russiancouncil.ru/inner/?id_4=489#top

22. http://russiancouncil.ru/blogs/dvfu/7id_4 - 298

23. http://www.gazprom.ru/about/production/projects/pi pelines/ykv/

24. ITAR-TASS, 22.01.2014.

25. Ibid., 6.02.2014.

26. Zhiznin S. Z. Vostochnoe napravlenie [Eastern direction]. Nezavisimaya gazeta, 13.04.2011.

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