Economic Analysis Of Natural Gas Trading Between Russia And China Through Pipeline "Power Of Siberia"

The present research deals with economic analysis of natural gas trading between Russia and China through pipeline “Power of Siberia”.To date,the world gas market is developing as a fairly rapid pace.China is the third country in terms of consumption of natural and liquefied gas.The aim of this research is an economic analysis of natural gas trading between Russia and China through “Power of Siberia” and develop practical suggestions for pipeline efficiency and setting the natural gas price,at the positive NPV and also taking into consideration theoretical background,so that the gap between theory and practice in this issue can be narrowed down.For research were taken next methodology: benefit-cost analysis,as well as,an analysis of the sensitivity of various factors to NPV changes,comparative analysis of CAPEX and OPEX liquefied gas from Australia,Qatar,Russia with pipeline ”Power of Siberia” for the purpose of project expediency for China as a gas consumer in large volumes.Because the gas price contract is uncertainty this research will be relevant and useful to understand and answer on questions,such as: Is natural gas pipeline “Power of Siberia” cheaper,then to consume LNG from other countries?The results based on the benefit-cost analysis demonstrates that the natural gas price should be more,then $7,11 per MMBTU for pipeline ”Power of Siberia”,because with this condition the NPV project will be positive and in general the “Power of Siberia” is more profitable project,then LNG projects from Australia,Qatar and Russia,due to the pipeline has less,then 8000 km of distance the construction and operation costs for pipeline will be lower,then for LNG projects.Therefore,the suggestions are to adhere natural gas price at which NPV will be positive,to create special department who will monitor gas market and global risks those can be really influence on the efficiency and work project.