Gazprom's Miller: progress on Chinese deal
By Sean Carney
Published: June 2, 2011 1:43 p.m. ET
SeanCarney
PRAGUE -(MarketWatch)- Russia's OAO Gazprom (GAZP.RS) is near closing a natural gas supply and pipeline deal with China, but the company's chairman wouldn't confirm an early June deadline to finalize terms.
"We have reached certain progress" on the planned deal with China, Alexei Miller told reporters.
Miller didn't confirm the June 10 deadline on the deal mentioned earlier this week by Russian Deputy Prime Minister Igor Sechin.
Miller also didn't say whether the two sides had agreed on the price at which Gazprom would sell gas to China.
Regarding any loans to Gazprom to finance construction of a pipeline from Russia to China, Miller said "any reliable project typically (calls for) 30% proprietary funding and 70% leverage."
But, if a project is better than average, Gazprom could expect to pay move leverage on the deal and at better terms, he said without providing further details.
Miller said he expects long-term contracts for natural gas concluded in the fourth quarter of this year to be at $500 per 1,000 cubic meters of the fuel.