23 March 2013

RUSSIA / CHINA / ENERGY/ DEFENSE : 27 Mar UPDATE: Massive Nat Gas Deal Set...Except Price; New Leader Xi Jinping's First Visit...Is Moscow; $3.5 Billion Jets, Subs Purchase Announced.

       It was highly symbolic that China's newly chosen leader Xi Jinping chose Moscow...for his first foreign trip...where he was warmly greeted by President Putin...and later PM Medvedev.
      They signed several energy and investment deals...including a decade-long negotiated nat gas deal.
      President Jinping called the deals 'breakthrough.'
      Though the final price remains to be finalized...Gazprom will supply China with 38 billion cubic meters of nat gas beginning in 2018...that could increase to 60 bn cm.
      By comparison...the WSJ reports that Germany currently imports 33 bn cm from Russia.
      Gazprom is already constructing a nat pipeline in the Far East.
      Rosneft also agreed to double Chinese oil shipments to 31 million metric tons.
       China will buy 24x SU-35 fighters...and 4 Amur-class subs from Moscow...in a $3.5 billion deal.
      2 subs will be built in Russia and 2 in China. 
      It's Beijing's first large scale defense buy from Russia in a decade.
      But some in Moscow fear and resent that Beijing will copy the technology.