Overnight, following a grand ceremony in the Siberian city of Yakutsk, Russia and China officially began the construction of a new gas pipeline linking the countries. The bottom line to Russia - nearly half a trillion after China's CNPC agreed to buy $400bn in gas from Russia's Gazprom back in May. In return, Russia will ship 38 billion cubic meters (bcm) of gas annually over a period of 30 years. The 3,968 km pipeline linking gas fields in eastern Siberia to China will be the world's largest fuel network in the world.
As BBC reports, "the deal will lessen Russia's dependence on European buyers, who have imposed economic sanctions because of the crisis in Ukraine." That is not news and has been known for months ever since the long-anticipated Holy Grail deal was signed in May. More importantly, as Zero Hedge reported last week, one awaits as the invoices become increasingly less denominated in USD, and more in CNY or RUB. Most importantly, and confirming the significance of Russia's pivot away from Europe, which ultimately can have Qatar's gas it so very desires, irrelevant how many thousands of innocent people have to die, the construction ceremony was attended by Russian President Vladimir Putin and Chinese Vice-Premier Zhang Gaoli.