The shareholders of “Rosneft“, which is majority owned by the state, agreed to provide China a discount of $ 1.5 per barrel for oil delivered to China. The discount is presented in terms of debt repayment of $ 134 million paid by Chinese. Official notice of “Rosneft” shareholders’ meeting has not yet been published.
Under the new agreement, the oil will be delivered to China on market conditions minus the specified discount. Thus, if hydrocarbon prices stay around $ 100 a barrel, in 20 years “Rosneft” will receive about $ 130 billion from the contract with China.
Russian state-owned company “Rosneft” and “Transneft” agreed to supply oil to China as early as 2009. China issued Russian organizations a soft loan of 25 billion dollars. In spring 2011, the parties disagreed on the tariff for pumping oil through the pipeline “Eastern Siberia – Pacific Ocean” (ESPO) and debt began to accumulate.
The conflict was resolved only by the end of 2011, when the parties agreed to provide discounts in return of paying the debt. However, this decision required the approval of not only the leadership of “Rosneft”, but company’s shareholders.