Price haunts Gazprom deal with China

July 25, 2011 at 8:56 AM

LONDON, July 25 (UPI) -- China needs Russian natural gas to feed its economic growth though disagreements over price are hampering any deals, a Gazprom official said.

Chinese President Hu Jintao was expected to sign off on a deal for as much as 2.4 trillion cubic feet of natural gas during his June visit to Moscow.

Alexander Medvedev, deputy chief executive of Gazprom, told the Financial Times in London that his company was keen on landing a deal with energy-hungry China.

"But it's the natural desire of the buyer to buy cheaper and of the seller to sell higher and actually the current level of negotiation left only one unsolved issue and (that) is the price," he was quoted as saying.

The booming Chinese economy was seen on one of the reasons why the International Energy Agency said the world economy may be entering the "golden age of (natural) gas," the Financial Times adds.

"We believe China needs natural gas imported from Russia in order to keep the level of economic growth and the history of our supply and reliability of our supply is another argument for the Chinese," said Medvedev.

Gazprom would have to invest in major pipeline infrastructure to reach Chinese markets, however.

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