The Power of Siberia 2 Pipeline is a development that should be taken seriously by policymakers and American exporters.
At a meeting between Chinese President Xi Jinping and Russian President Vladimir Putin in Beijing, the two countries signed an agreement to build a natural gas pipeline that would run from western Siberia through Mongolia to China. The capacity that’s been discussed is fifty billion cubic meters of natural gas per year —roughly equivalent to what Russia would have been exporting to Europe via Nord Stream 2 until Russia’s invasion of Ukraine.
While this pipeline project will take a long time to build and will cost tens of billions of dollars, it should matter to Americans and others because, even though we don’t know all the terms of the agreement yet, including the price and the contract terms, if this pipeline moves ahead, this means China will buy more gas from Russia and less gas from the United States, Qatar, and Australia — each of which is a significant LNG market participant — and threatens to affect LNG companies in those three countries. Also, China had been hesitant to sign this agreement for some time, including uncertainty about the amount of its gas demand and fear that an agreement like this could trigger a backlash from the United States and the European Union in the form of new sanctions on Russian or Chinese companies. Now, Chinese leaders are less concerned about sanction risks than they were over the last three and a half years.
Similarly, in any kind of hypothetical conflict scenario in which the United States and China confront one another militarily, the shipping route that Russia currently uses to ship natural gas to China across the Bering Strait would be vulnerable to the United States. The Power of Siberia 2 Pipeline would be harder (albeit not impossible) for United States forces to reach.
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About the Author: Paul Saunders
Paul J. Saunders is President of the Center for the National Interest and a member of its board of directors. His expertise spans US foreign and security policy, energy security and climate change, US-Russia relations and Russian foreign policy, and US relations with Japan and South Korea. Saunders is a Senior Advisor at the Energy Innovation Reform Project, where he served as president from 2019 to 2024. He has been a member of EIRP’s board of directors since 2013 and served as chairman from 2014 to 2019.
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