BEIJING, March 3: China has signalled its agreement to a Russian plan to build an extension to Japan of a key Sino-Russian oil pipeline if supply to China is guaranteed, state press reported Monday.

“We are not against the (new) proposal ... Should they guarantee our supply as we have agreed, the addition of other pipelines is totally their (Russia’s) business,” the China Daily quoted an unnamed government official as saying.

“Both China and Russia have done a lot of work since 1994. But it now depends on Russia’s plans, as well as negotiations between the Chinese and Russian governments.”

Plans to build a 2,400-kilometre pipeline to carry oil from Siberia into energy-hungry China were put on hold when Russian companies suggested scrapping it in favour of a longer pipeline to Nakhodka on the Sea of Japan.

In early February a compromise was put forward that would see the construction of a pipeline to China from Angarsk first while later links would be added from Chita, Russia to supply Japan, South Korea and eventually the United States.

The Russian government is expected to vote on the issue at a meeting on March 13.

The compromise is believed to be preferred by Moscow and is likely to be favoured by Washington as it would open Russian oil supplies to a wider market than China, hence reducing US dependence on ME producers.

However it would involve an investment of five billion dollars, the Chinese route, from Angarsk to China’s northern Heilongjiang province, would be much cheaper at an estimated 1.8 billion dollars.—AFP