The Wall Street Journal reports that "Russia and China's largest energy companies on Friday announced a "breakthrough" deal paving the way for joint development of massive energy reserves in eastern Siberia, in a sign that Moscow is overcoming its fear of Chinese encroachment on Russia's Far East".
"Their preliminary agreement illustrates how Moscow is increasingly looking to Asia for customers for its abundant energy reserves, and for funding to develop them. Russia's needs tie in with expected long-term demand growth in oil and gas-deficient China and elsewhere in East and South Asia, and slowing energy consumption in many industrialized nations.
Russian state oil giant OAO Rosneft and China National Petroleum Corp. said that under a Memorandum of Understanding signed during Rosneft President Igor Sechin's trip to Beijing on Thursday they would explore for, and produce oil and gas in eastern Siberia".
Rosneft and CNPC would form a joint venture, the companies said Friday in separate statements, with Rosneft taking 51% and CNPC holding the rest.
They plan to develop an oil field that Rosneft gained full control of this week by consolidating 100% of the Taas-Yuryakh oil firm, Rosneft said. CNPC said that the two would also collaborate closely to develop several large-scale oil and gas fields.
"The oil produced will be used to meet the energy demand in eastern Russia and then exported to China and other Asia-Pacific countries through the Russia-China crude pipeline," CNPC said
