Mongolia delays construction of Siberia-2 natural gas pipeline between Russia and China

• Radio Free Europe reports that Mongolia will stop financing the Siberia-2 pipeline over the next four years.
• The natural gas pipeline is an ambitious project to deepen trade between Russia and China.
• Construction of the pipeline has already stalled due to disagreements between Moscow and Beijing.

Plans for an ambitious natural gas pipeline between Russia and China have hit an obstacle caused by a very different country: Mongolia.

According to Radio Free Europe, the Mongolian government has not earmarked any funds for the Power of Siberia-2 pipeline in its spending plans for the next four years. The country serves as a buffer state between Russia and China and its commitment would be necessary for the realization of the project.

This new obstacle further complicates an already uncertain megaproject.

Russian energy giant Gazprom began planning and surveying the pipeline in 2022 and expects it could deliver 1.8 trillion cubic feet of Russian natural gas to China annually.

This would make the Siberia-2 pipeline Gazprom’s biggest deal with Beijing and could provide a much-needed solution to Western sanctions. After Russia invaded Ukraine that same year, energy restrictions on Moscow have crippled the country’s gas trade.

A study commissioned by the company found that Gazprom will probably not recover the gas sales lost due to the Ukraine war for a decade, making the deployment of Siberia-2 all the more important.

But the pressure on Chinese partners is much less, as energy experts say the country will not need any more gas before the mid-2030s. For this reason, pipeline negotiations between Beijing and Moscow have stalled due to price and supply disputes.

According to Radio Free Europe, the pipeline plans also run counter to China’s increasing move toward green energy.

Moreover, the Siberia 2 project is not China’s only option: President Xi Jinping has also signaled support for Pipeline D, thereby deepening relations with Turkmenistan.

Increased access to eastern markets has proved a lifeline for Russia as the West increasingly shuns the Kremlin. China is playing a central role in this shift, with bilateral trade rising to a record $240 billion last year.

Because Moscow is highly dependent on its relations with Beijing, some experts call it an emerging vassal of China.