Russian President Vladimir Putin and his Chinese counterpart Xi Jinping attended an official ceremony via video conference marking the launch of the Power of Siberia pipeline on Monday.
The 1800 mile pipeline is set to begin delivering Russian natural gas to China on Monday five years after Moscow and Beijing signed a 30-year purchase and sale agreement for the gas supplies via the pipeline.
The multi-billion channel is a feat of energy infrastructure and political engineering, which had to overcome the Siberian landscape to provide gas for China.
Being the most significant energy project for Russia after the collapse of Soviet Union, the Power of Siberia pipeline is a physical bond strengthening a new era of cooperation between two world powers that have separately challenged the economic and strategic clout of the US.
Russian President Vladimir Putin and President Xi Jinping of China posing for a photo
Gazprom Company, implementing the project, plans to start with deliveries of 10 million cubic meters a day and reach peak capacity in 2025.
The link is important to Russia as it will provide a hedge against deteriorating relations with Europe and strengthen talks over gas contracts with European countries.
Russia and Ukraine have bickered for years over the transit fees, forcing the former to turn off gas in the middle of the winter.
The political relationship between Russia and Europe has become fraught since Russia seized Crimea in 2014 and the US and Europe responded with sanctions.
China being the world’s biggest energy consumer and importer, the Russian gas will supplement the output from its domestic fields and could be cheaper than Liquefied Natural Gas (LNG) arriving in tankers.
With the escalating demand for gas, the government forced millions of factories and homes to switch away from coal to cleaner-burning gas to help tackle smog and reduce carbon dioxide emissions.
The Russian company, Gazprom, will be opening a new pipeline, Nord Stream 2 that will give Russia the means to bypass Ukraine entirely if tensions occur.
The gas flowing through the pipeline will be linked to oil prices, similar to the system used by European buyers.