Mongolia still expects the Power of Siberia 2 project - a new gas pipeline connecting Russia and China - to continue implementation despite geopolitical instability that could lead to a reset of relations between Beijing, Moscow and Washington, SCMP reported.
When completed, the pipeline will bring 50 billion cubic meters of Russian gas per year through Mongolia to China.
But in recent months, many speculations have stalled the progress of the super pipeline project because analysts believe China does not want to increase its dependence on energy imports from Russia.
The Power of Siberia 2 project has been eliminated from the 2024-2028 working program of the Mongolian Government. Chinese and Russian officials have also provided little updated information about the pipeline project.
However, the first Deputy Prime Minister and Mongolian Minister of Economy Gantumur Luvsannyam affirmed that negotiations on the pipeline are still ongoing and are making progress.
"The reason the pipeline is not included in the Mongolian government's action program is because it is an issue that the Mongolian cabinet cannot decide unilaterally. For the project to be implemented, China and Russia must first reach an agreement," Mr. Luvsannyam shared with SCMP.
Mongolian officials also stressed that the Power of Siberia 2 pipeline project is not hampered by differences in political level, but related to business concerns of the National Oil and Gas Group of China (CNPC).
"I think the only problem is that the buyers need to reach an agreement on investment and prices with the Russian supplier," he said.
Power of Siberia 1 - the first gas pipeline connecting Russia and China - has been completed and is capable of transporting 38 billion cubic meters of Russian gas to northeastern China each year. The pipeline has also been expanded to supply gas to Shanghai.
However, China is also trying to diversify energy supply to reduce the risk of dependence on any individual market.
Last year, Russia was China's second largest pipeline gas supplier, with an import of $8 billion, accounting for 38.1% of China's total supply. Russia is also the third largest supplier of liquefied natural gas to China, accounting for 10.8% of total imports.
If China and Russia reach an agreement and start building the Power of Siberia 2 pipeline, we are ready to cooperate and accelerate the project. The Mongolian government is committed to promoting this project," said Mr. Luvsannyam.
Meanwhile, SCMP noted that Chinese officials remain silent on Power of Siberia 2. In an interview published by China Electric Power News earlier this week, Liu Hong - head of the oil and gas division of the National Energy Administration of China - did not mention the Power of Siberia 2 pipeline when listing the agency's major projects in 2025.
Also this week, when announcing the working report at the bilateral meeting, the National Development and Reform Commission of China emphasized that China will promote energy cooperation with global partners, including the expansion of the Power of Siberia 1 gas pipeline.
