The Power of Baikal pipeline for Russian gas exports to China can help reshape the global gas market
Russia and China are developing a project for the Power of Baikal gas pipeline, which will carry Russian gas to the People’s Republic of China (PRC) via Mongolia. The planned pipeline promises to become one of the largest gas transportation route in Eurasia.
What is the Power of Baikal?
The Power of Baikal is a trunk gas pipeline designed to supply Russian gas to China. It is planned to run from the Tambey gas field on the Yamal Peninsula through several Russian regions to Mongolia and then onward to the PRC. The pipeline’s design capacity is estimated at 50 billion cubic meters of gas per year.
The project’s key participants are Russia’s Gazprom and China’s largest oil and gas company, CNPC (China National Petroleum Corporation), which is wholly state-owned. In September 2025, the parties signed a legally binding memorandum on the construction of Power of Siberia 2 (the project’s former name) and the Soyuz Vostok transit gas pipeline across Mongolian territory. The contract is expected to run for 30 years.
“This will now be the largest, most extensive, and most capital-intensive project in the global gas industry,” Gazprom CEO Aleksey Miller said after the signing.
He noted that the project had been conceived back in the previous decade, before the Power of Siberia gas pipeline was commissioned and Russian gas exports to China began.
At present, the project is at the preparation stage ahead of the start of construction. Discussions are underway on its final route, and the commercial terms are being specified.
Following Russian President Vladimir Putin’s visit to China in May 2026, presidential press secretary Dmitry Peskov said that progress had been made, but the parties had not yet reached the “finalization of agreements.” In turn, Russian Deputy Prime Minister Aleksandr Novak also told journalists that final agreements had not yet been reached during the Eastern Economic Forum, held in Vladivostok from September 1 to 4.
“The issue will be determined once final agreements on the contract have been reached, including the route,” he said.
At a regular meeting with the Premier of the State Council of the PRC on October 21, Russian Prime Minister Mikhail Mishustin stated, “Construction of the Far Eastern route is underway, and the project to build the Power of Baikal pipeline is being developed. It could become one of the largest gas transportation route in Eurasia.”
Why did the project change its name?
The project was previously called Power of Siberia 2 and was renamed Power of Baikal at the initiative of President Vladimir Putin. According to Russian Energy Minister Sergey Tsivilyov, the new name is “more appropriate” because it reflects the need to balance exports with meeting the country’s domestic needs.
“The president has set the task: Russia’s needs must be met first and foremost. But a reasonable balance must be found,” Tsivilyov said.
China has expressed a similar view. The Chinese publication Baijiahao noted that Lake Baikal is one of Russia’s natural symbols. In its view, by incorporating this symbol into the project’s name, Moscow is asserting the project’s independent significance: the pipeline’s purpose is not only to export gas to China but also to deliver it to Russian regions.
Russian independent economist Viktor Mangazeyev notes that the renaming coincided with the point at which negotiations over pricing stalled.
“Against this backdrop, the name change may have served as a gentle reminder that the project is not exclusively export-oriented. It is also linked to the domestic gasification of Siberian and Far Eastern regions, and Russia will not rush into concessions for the sake of a single customer,” he explained.
Significance of Power of Baikal
For Russia, the project is an important instrument for redirecting energy exports following the substantial reduction in supplies to Europe. The Power of Baikal will make it possible to redirect a significant portion of the country’s resource base and establish a stronger foothold in the rapidly growing Asian market.
The project will create an alternative overland route to complement the existing Power of Siberia pipeline and the Far Eastern route, increasing the flexibility and resilience of Russia’s export system.
In addition, the pipeline may be used not only for exports but also to supply gas within Russia. This is particularly important for the Russian Far East.
For China, the project is a strategic instrument for enhancing energy security. The new overland route across its northern border will significantly reduce the country’s dependence on maritime liquefied natural gas (LNG) deliveries.
At the same time, it should be noted that China regards gas as a “transitional fuel” for replacing coal and supporting the development of renewable energy. Direct supplies through northeastern and northern China will help facilitate the shift from coal to gas, increasing the competitiveness of Chinese industry.
For Mongolia, which will serve as a transit country, the project creates opportunities for economic growth and for strengthening its geopolitical position. The country will receive substantial transit revenues as well as infrastructure investment, including the construction of roads, compressor stations, and other facilities. In addition, the construction and operation of the pipeline will create new jobs. At the same time, Mongolia will become an important link in the emerging Eurasian energy network, enhancing its strategic importance in the region.
As Mongolian Prime Minister Nyam-Osoryn Uchral noted during the plenary session of the Eastern Economic Forum, “The project to supply Russian natural gas to China through Mongolian territory opens up new strategic opportunities for the economic relations of the three countries and has every chance of becoming a project that creates long-term mutual benefits in energy, transport, infrastructure, investment, and professional training.”
On a global scale, Power of Baikal could become a geoeconomic factor reshaping the configuration of the world gas market. Once the pipeline enters service, significant volumes of Russian gas will be definitively redirected from West to East, which, in turn, will lead to a redistribution of global energy flows and strengthen Asia’s role in international gas trade.
