PetroChina, China's No 1 oil producer, is expected to strike a US$1.7 billion pipeline deal with Russia's second-largest oil company Yukos during Russian President Vladimir Putin's visit next week.
The planned pipeline - an estimated 2,400km, stretching from eastern Siberia to China's Daqing - will supply 6.8 per cent of China's estimated oil consumption in 2005, as well as give new momentum to PetroChina's growth, according to HSBC Securities.
'We speculate that a deal could be announced as early as this weekend during President Putin's last visit to China before President Jiang Zemin's term ends in March 2003,' said HSBC analyst Gordon Kwan.
During Mr Putin's three-day visit, begining on Sunday, the two leaders are expected to discuss subjects including co-operation in the energy sector.
Mr Kwan expected that under the deal PetroChina and Yukos would build a pipeline from the Russian city of Angarsk to China's oil centre Daqing. The pipeline was expected to bypass Mongolia but follow its border due to Chinese security concerns.
It would supply 400,000 barrels of oil per day to northern China, Mr Kwan estimated.
