Russia’s OAO Rosneft reached a deal with the Chinese government to double its crude-oil deliveries from its current volume, boosting energy links between the two major emerging economies, Russia and China.
Under the agreement, China will provide Rosneft, the world’s largest listed oil producer, a $2bn loan in exchange for 25 years of deliveries, according to Rosneft CEO Igor Sechin after the signing of the agreement.
The Russian state oil firm already supplies 15 million metric tons to China every year under a deal signed in 2009. Russian pipeline operator OAO Transneft and Rosneft received a $25bn loan from China in that deal.
The deal was finalized during the visit to Moscow by Chinese President Xi Jinping, his first official trip abroad since taking office.
Rosneft will also be partnering with China National Petroleum Corporation (CNPC) in the development of onshore blocks and offshore licenses. The Chinese energy firm is Rosneft’s latest foreign partner in its long-term development plan to tap resources in the Arctic shelf.
CNPC also signed a memorandum last week with Russian state oil company OAO Gazprom to deliver gas to China from Russia’s far east fields.
On Thursday, Rosneft announced that it acquired TNK-BP for $60bn to become the world’s biggest listed oil producer.