Moscow is looking at allowing Chinese firms to own majority shares in its strategic oil and gas fields for the first time, according to Deputy Prime Minister Arkady Dvorkovich. Reuters reports:
“We have a strategic partnership with China and now decisions are made much faster than before. In particular, we have a gas contract, a second one will be signed soon. Now we know China better: their motives and intentions are understood,” [Dvorkovich] told a conference in the Siberian city of Krasnoyarsk.“There used to be a psychological barrier. Now it doesn’t exist any more. We are interested in maximum investments in new industries. China is an obvious investor for us.”
Western sanctions have dried up the pool of investors available to Russia, which has the Kremlin looking east for capital. Energy-hungry China has proved eager to take advantage of its neighbor’s difficult situation, signing what appear to be favorable terms for one major gas deal and preparing to finalize another in the coming months.But while Russia may have found a way to lessen the impact of recent sanctions, its energy future is still looking gloomy without Western support. The country’s Siberian shale reserves are underdeveloped, and Chinese money alone won’t be enough to get oil and gas flowing from the remote region. Beijing itself has found it very difficult to start commercially producing hydrocarbons from shale, and without the technology and know-how that Western companies bring to the field, Moscow is going to have an even worse time catching up to the U.S. energy boom.