BIZCHINA> Top Biz News
Report: Russia, China sign $25b oil loan deal
Updated: 2009-02-17 19:28

Russia signed its biggest ever energy deal with China on Tuesday, under which its oil companies will receive $25 billion in loans in exchange for long-term crude supplies, a source close to the talks told Reuters.

The source said state oil champion Rosneft and pipeline monopoly Transneft signed a long-delayed deal to borrow the money from China Development Bank.

"The credit was provided by the (China) Development Bank," the source said on condition of anonymity.

He said the Russian delegation currently in China included Deputy Prime Minister Igor Sechin, who oversees the energy sector, Energy Minister Sergei Shmatko, Rosneft President Sergei Bogdanchikov and Transneft President Nikolai Tokarev.

Rosneft and Transneft declined immediate comment.

Russia, the world's second-largest oil exporter after Saudi Arabia, is seeking to diversify its exports away from the West and is targeting China as the main market for oil that will be extracted from its new generation of fields in East Siberia.

The $25 billion loan is part of a broader oil supply deal which will allow Beijing to secure deliveries for 20 years and give Russian firms the means to sort out refinancing needs.

Interfax news agency reported Rosneft and China National Petroleum Company (CNPC) had signed a final version of the 20-year deal to supply Russian crude to China.

Transneft and CNPC agreed in October to build a spur to carry 15 million tons (300,000 barrels per day) of oil between the countries' trunk pipelines from 2009.

(For more biz stories, please visit Industries)