Russian natural gas supplies to China via the “western route” pipeline could exceed deliveries to Europe in the mid-term perspective, said Gazprom CEO Alexei Miller, according to RIA Novosti.

Alexei Miller and the director of the Chinese energy company CNPC, Zhou Jiping, met in Beijing to set up the framework agreement by which Russia will supply China natural gas via ‘western route’ pipeline. The route will link directly the gas fields in Western Siberia and the north west of China through Altai republic, according Agerpres.

“Given the increase in deliveries via” western route “, in the medium term the volume of gas delivered to China will be higher than European exports”, said Alexey Miller.

He said that the price formula for Russian gas delivered to China will include an obligation of take-or-pay type. According to the contractual terms of the “take-or-pay”, Gazprom customers are required to pay for a certain amount of gas even if in reality they purchased a smaller amount.

In May this year, Gazprom signed an initial agreement with CNPC on the delivery of 38 billion cubic meters of gas annually to China for 30 years through a 3,000 km pipeline called “Siberian Power”. Deliveries through this first line would begin in 2018. When the “western route” will be finished, China will become the largest importer of Russian gas (68 billion cubic meters annually), surpassing Germany (40 billion cubic meters).