Gazprom Centralized Pipelines, 50 Bcm CNPC Supply Plan, RUB 1.52 T Budget, and 2 Major Projects (2024 to 2026)

Centralized Infrastructure Risk, Gazprom’s Pivot from Europe to Asia

Gazprom’s strategic response to the collapse of its European market is an exclusive focus on large-scale, centralized gas export infrastructure directed at Asia, a decision that creates significant long-term concentration and transition risks. Instead of diversifying into decentralized or alternative energy systems, the company has doubled down on its legacy model of capital-intensive pipelines, effectively trading one dominant market for another. This strategy prioritizes immediate volume replacement over building a resilient, modern energy business.

• Before 2024, Gazprom‘s business model was anchored to the European market, which has since almost completely closed due to geopolitical events and sanctions. This forced a fundamental reorientation of the company’s entire export strategy.
• From 2024 through 2026, all major commercial activities and investments are directed eastward. This includes maximizing flows through the operational Power of Siberia 1 pipeline and advancing the strategic Power of Siberia 2 project.
• The pivot exposes Gazprom to extreme customer concentration risk. The success of its entire long-term strategy now depends on a single buyer, China, which holds immense negotiating leverage on critical factors like pricing and volume commitments.
• This approach is in direct opposition to the diversification strategies of other energy majors and the broader global energy transition. While other companies invest in technologies like geothermal or carbon capture, Gazprom‘s 2025–2026 actions show a complete absence of investment in distributed energy or decarbonization technologies.

RUB 1.52 Trillion, Gazprom 2025 Investment for Export Pipelines

Gazprom‘s 2025 investment plan confirms its narrow strategic priority, allocating a reduced RUB 1.52 trillion budget almost entirely to its “priority” centralized export projects. This spending decision, made in late 2024, illustrates a clear choice to fund the physical redirection of gas flows to Asia while foregoing any significant investment in domestic grid modernization or alternative energy technologies that could build long-term resilience.

• The 2025 investment budget of RUB 1.52 trillion (approximately $15.2 billion) represents a significant reduction from previous years, reflecting the company’s constrained financial position following the loss of European revenues.
• These funds are explicitly earmarked to finance key export projects, primarily the continued development of the Power of Siberia pipeline system and the upstream gas fields required to supply it.
• No portion of this publicly announced budget is allocated to distributed generation, renewables, or other non-hydrocarbon initiatives. This indicates that diversification is not a financial or strategic priority for the company in the 2025–2026 period.
• This contrasts with the capital allocation of other major energy players, which are actively funding projects in different sectors. For example, some technology companies are securing large-scale clean energy through direct investment in new nuclear, like the effort by Microsoft to procure power from small modular reactors.

Table: Gazprom Strategic Capital Allocation

Gazprom 2 Key Asian Partnerships for Gas Exports (2024 to 2026)

Gazprom‘s partnership ecosystem has been completely reconfigured around securing gas transit and sales agreements in Asia. Its relationships with China’s CNPC and the government of Mongolia are now the central pillars of its commercial strategy, defining its path for recovering lost export volumes and generating future revenue.

• The most critical relationship is with China’s state-owned CNPC, the sole counterparty for the massive volumes supplied via the Power of Siberia 1 and the planned Power of Siberia 2 pipelines.
• A key enabling partnership was secured with Mongolia, which serves as the designated transit country for the proposed Power of Siberia 2 pipeline. This route is essential for connecting West Siberian gas fields, which formerly served Europe, to the Chinese market.
• In September 2025, Gazprom formalized supply and transit agreements with Central Asian countries, including Kazakhstan and Uzbekistan. These agreements secure a southern export route and expand Gazprom‘s influence in the region, even as pricing details remain a point of contention.

Table: Gazprom Asian Partnership Agreements

Asia vs. Europe, Gazprom’s Geographic Market Realignment

Gazprom has executed a complete and rapid geographic realignment of its business, fundamentally shifting its operational and commercial focus from its decades-long position in Europe to establishing China and, to a lesser extent, Central Asia as its new core markets. This pivot is not a strategic choice for growth but a necessary reaction to market exclusion, locking the company into a new geopolitical and economic dependency.

Gazprom Pivots East as Europe Market Collapses

This chart perfectly illustrates the section’s theme, visualizing the dramatic collapse of Russian gas exports to the EU and the corresponding pivot to Asia.

(Source: Center on Global Energy Policy – Columbia University)

• Before the market collapse, Europe was the primary destination for Gazprom‘s exports and the main driver of its revenue and investment decisions.
• In 2025, the company’s activities are almost exclusively focused on Asia. Deliveries to China via the Power of Siberia 1 pipeline are set to reach 38.8 Bcm, exceeding contractual volumes and cementing China as the new primary customer.
• Central Asia has emerged as a secondary but important region, where Gazprom is acting as both a supplier and a transit coordinator, increasing its market presence in countries like Uzbekistan.
• This geographic shift solidifies China’s role as the principal demand center and price-setter for Gazprom‘s gas. The company’s future financial performance is now directly tied to Chinese domestic energy policy and economic growth.

Legacy Technology Risk, Gazprom’s Centralized Pipeline Focus

By concentrating its entire investment strategy on large-scale natural gas pipeline technology, Gazprom is deepening its commitment to a legacy energy system. This move runs counter to the global trend of technological diversification and decarbonization, exposing the company to significant long-term stranded asset risk as the world transitions to lower-carbon energy sources.

Future of Gas Uncertain in Energy Transition

Illustrating the ‘legacy technology risk,’ this chart shows multiple global scenarios where natural gas demand stagnates or declines, posing a long-term stranded asset risk.

(Source: RFF.org)

• The core technologies behind the Power of Siberia projects are large-diameter, long-distance pipelines and conventional gas extraction. This is a mature, 20 th-century energy transport model with little innovation.
• Between 2024 and 2026, Gazprom has announced no significant investments or pilot projects in emerging energy technologies such as hydrogen, advanced carbon capture, or utility-scale energy storage.
• While its subsidiary, Gazprom Neft, has publicly acknowledged the future role of renewables, this has not translated into any material action or capital allocation from the parent company.
• This technological monostrategy is a stark contrast to the activities of global technology firms and energy companies actively securing diverse energy sources, from agreements for fuel cells to new deals in geothermal and nuclear power.

SWOT Analysis, Gazprom Strategic Risks and Opportunities

An analysis of Gazprom‘s position reveals a company with immense resource strength but facing critical weaknesses and external threats from its new market concentration and the global energy transition. Its opportunities are largely confined to the success of its singular strategic pivot to Asia, limiting its ability to adapt to future market shifts.

Asian Gas Market Growth Underpins Gazprom’s Opportunity

This chart quantifies the ‘Opportunity’ in the SWOT analysis by showing projected growth in the Asia-Pacific gas power market, Gazprom’s new target region.

(Source: MarketsandMarkets)

Table: SWOT Analysis for Gazprom Centralized Infrastructure Strategy

Gazprom’s Power of Siberia 2, What to Watch in CNPC Negotiations

The single most critical variable for Gazprom‘s medium-term future is the successful conclusion of a sales and purchase agreement with China for the Power of Siberia 2 pipeline. Failure to secure favorable terms in the next 12-18 months would undermine its entire long-term recovery strategy and leave the company with limited options for growth.

• If this happens: A final, binding agreement for the 50 Bcm per year Power of Siberia 2 project is signed between Gazprom and CNPC.
• Watch this: The final agreed-upon price for the gas. A price point significantly below the cost of LNG delivered to Asia would be a clear signal of China’s superior negotiating leverage and would cap Gazprom‘s future profitability.
• These could be happening: A successful agreement would be followed by announcements of a finalized 2026 investment budget increase and the awarding of major construction contracts for the pipeline’s route through Mongolia and Russia. Conversely, continued silence or vague statements from either party through late 2025 and into 2026 would signal a serious impasse on pricing.

The questions your competitors are already asking

This report covers one angle of Gazprom’s strategic pivot to centralized Asian gas exports. The questions that matter most depend on your work.

• What is actually happening with the Power of Siberia 2 project and the 50 Bcm CNPC supply deal?
• Is Gazprom’s pivot to Asia a good investment, given its extreme customer concentration risk with China?
• Which energy majors are gaining ground by pursuing diversification, while Gazprom doubles down on its legacy pipeline model?

This report does not answer these. Enki Brief Pro does.

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