Energy partners: the head of Rosneft Igor Sechin met with colleagues and China

Russian-Chinese energy dialogue is at a high level

The state visit of the President of the People’s Republic of China Xi Jinping to Moscow has become an important milestone in the development of not only political relations between Russia and China, but also comprehensive cooperation between the countries. For example, representatives of the China National Oil and Gas Corporation (CNPC) met with Igor Sechin, Chief Executive Officer of Rosneft, to discuss plans for further cooperation.

The delegation from the Chinese side was headed by CNPC Vice President, Executive Director and President of PetroChina Huang Yongzhang.

Rosneft and CNPC have been reliable partners for almost two decades; this cooperation is of a strategic nature. Our companies successfully cooperate in a number of areas of activity, contributing to the development of the energy dialogue between Russia and China, the implementation of large-scale infrastructure projects in Eurasia. We look forward to the further development of integral cooperation with CNPC along the entire technological chain, to the expansion of the range of joint projects,” Sechin said at the meeting.

The event outlined a plan for the further development of cooperation, including in the field of exploration, production and supply of oil. As Deputy Chairman of the State Duma Committee on Economic Policy Mikhail Delyagin noted, Rosneft and CNPC have long years of successful cooperation. For example, there is an agreement between the companies on cooperation in the field of exploration and production in the Russian Federation. Also, as part of the agreement signed in February 2022, Rosneft and CNPC are exploring prospects for cooperation in a number of areas of low-carbon development. In particular, we are talking about reducing greenhouse gas emissions.

Rosneft and CNPC also interact within the framework of the Joint Coordinating Committee. It was created to develop cooperation in the field of exploration and development of oil and gas fields, oil refining and petrochemistry, trade in oil and oil products, scientific and technical research, and training.

Another important topic that was touched upon at the meeting of companies was the preparation of the fifth Russian-Chinese energy business forum. This large-scale event in the world energy industry is necessary for the development of a dialogue between Russia and China, an increase in bilateral trade, an expansion of the portfolio of joint projects, and attraction of investments and project financing. Since 2018, four forums have already been held, within the framework of which about 60 agreements on mutually beneficial cooperation in the energy sector have been concluded.

“The ambassador of Russian-Chinese energy cooperation is Rosneft, represented by its head Igor Sechin. During his tenure as Deputy Prime Minister of the Russian Federation, he became the ideological inspirer of key energy projects in the two countries, including the construction of the Eastern Siberia-Pacific Ocean oil pipeline. This highway became the prototype of large-scale infrastructure projects within the framework of the One Belt, One Road initiative. Rosneft also became the first Russian company to sign long-term contracts with the Chinese side. This agreement, called the “deal of the century”, brought the Russian-Chinese energy dialogue to a fundamentally new level and became the foundation for many years of successful cooperation between Moscow and Beijing,” said Valery Andrianov, associate professor at the Financial University under the Government of the Russian Federation, an expert at the InfoTEK analytical center.

“Cooperation within the framework of the presidential commission on the fuel and energy complex and at the sites of the four Russian-Chinese energy business forums that took place allowed the energy sector to become the base industry for the growth of trade between the two countries, which reached $185 billion by the end of 2022,” commented the deputy director of the Institute of National energy Alexander Frolov.

He added that it was no coincidence that in November, speaking at the Russian-Chinese Energy Business Forum, Igor Sechin described trade and economic relations between Russia and China as a “pole of stability and growth” against the backdrop of the global economic crisis. “Given the pace and scale of cooperation, we can confidently assume that the implementation of new energy projects will make it possible to reach a trade turnover of 200 billion already in 2023, a year ahead of the goal set by the leaders of the two countries,” Frolov summed up.

“Energy cooperation, and in general cooperation between Russia and China, is actively developing, and Rosneft is a leader in this area,” said Sergey Suverov, investment strategist at Arikapital Management Company.

According to Suverov, China is a key sales market for Russian oil – the company’s share in Chinese imports is about 10%. In this context, it is worth remembering that Rosneft became the first Russian company to sign long-term contracts with the Chinese side, including with CNPC – the famous “deal of the century” for the supply of 325 million tons of oil. From 2005 to 2022, Rosneft’s total supplies to China amounted to 442 million tons of oil. And in February 2022, Rosneft and CNPC signed a 10-year contract to supply an additional 100 million tons of oil to China via Kazakhstan.

It should be noted that Rosneft’s cooperation with Chinese partners in the energy sector is integral in nature, covering all business segments – from production and supply to hydrocarbon processing and petrochemicals.