Source link : https://london-news.net/declining-gazprom-stocks-highlight-investor-skepticism-over-power-of-siberia-2-pipeline-deal/
Shares of Gazprom, the Russian energy behemoth, fell sharply on Tuesday following the announcement of a “legally binding” memorandum with China to move forward with the long-stalled Power of Siberia 2 pipeline project.
On the Moscow Exchange, Gazprom’s stock closed down 3.1% at 130.7 rubles, resulting in a loss of over 100 billion rubles (approximately $1.2 billion) in market capitalization.
This drop marked the most significant decline among all companies on the exchange’s main index, more than doubling the index’s overall fall of 1.4%.
The anticipated Power of Siberia 2 pipeline, which is expected to have an annual capacity of 50 billion cubic meters, has been a part of the Kremlin’s plans for nearly 20 years. The urgency of the project has increased as Moscow looks for alternatives to compensate for the steep decline in Gazprom’s previously lucrative exports to Europe.
However, investors quickly pointed out that the agreement reached in Beijing is merely a memorandum of intent and does not represent a binding supply agreement.
Sergei Kaufman, an analyst from the investment company Finam, cautioned that if the project progresses, it could strain Gazprom’s already troubled finances.
The 2,600-kilometer pipeline is projected to cost around 2 trillion rubles ($25 billion, based on current foreign exchange rates from Reuters), and there has been no confirmation from China regarding its financial involvement in the project.
Gazprom’s CEO, Alexei Miller,…
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Publish date : 2025-09-03 16:08:00
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