Turkmenistan Bets $5.1bn on Galkynysh Expansion as Russia's China Gas Route Stays Stuck on Price

Turkmenistan Bets $5.1bn on Galkynysh Expansion as Russia's China Gas Route Stays Stuck on Price Ashgabat's CNPC deal advances a rival Caspian supply line to China just as Power of Siberia 2 remains hostage to a Moscow-Beijing pricing impasse. Russia and China reached only a general understanding on the Power of Siberia 2 pipeline at Vladimir Putin's summit with Xi Jinping in Beijing during the week of 2026-05-18, with key details and a timetable still unresolved, a Kremlin aide said on Monday (2026-05-18).^1,3² The stall keeps a door open for Caspian gas. Turkmenistan, the region's dominant exporter, is pushing to lock in long-term Chinese demand while its Russian competitor argues over terms, and the contrast between the two supply routes is now sharper than at any point in the past year.^4,2 Power of Siberia 2 is designed to carry 50 bcm of gas a year to China through Mongolia from Russia's Arctic Yamal fields across a 2,600-kilometre route, according to Reuters.^3,1 It would sit on top of the existing Power of Siberia 1, which delivered 38 bcm last year and which Putin and Xi agreed in September to lift to 44 bcm a year.^1,3 The hold-up is money. China reportedly wants pricing close to Russia's domestic rate of roughly $120-130 per 1,000 cubic metres, while Moscow is seeking terms nearer Power of Siberia 1, which analysts estimate would more than double that figure.² One analysis described the project as hostage to a Gazprom and CNPC pricing impasse, with the loss of European volumes weakening Moscow's hand.⁴ That gap matters for Caspian suppliers. Every month the Russian pipeline slips, Turkmenistan and its neighbours have more room to fill the gas China still needs, and Beijing has every incentive to diversify rather than hand Gazprom pricing leverage.^4,2 China already leans heavily on Central Asia. Three pipelines running from Turkmenistan and Uzbekistan through Kazakhstan into Xinjiang supply more than 40 bcm of natural gas a year, the largest single piece of China's import network outside seaborne LNG.¹ The country's pipeline gas imports reached 59.4 million tonnes in 2025, with that Central Asian corridor the backbone.¹ China's own planning points the same way. Its 15th five-year plan, released in March, committed only to advancing "early-stage" work on Power of Siberia 2, language that stops well short of a construction decision.^1,3 For a buyer weighing a Russian route still tangled in price against Caspian volumes already flowing, the cautious wording reads as leverage retained. The southern flank fills in the rest. The 793-kilometre Myanmar-China Gas Pipeline, running since 2013, was built to carry 12 bcm a year, and Russia and China are jointly constructing a separate 10 bcm line to move gas from Sakhalin.¹ None of these rivals the scale of a fully built Power of Siberia 2, but together they reduce China's urgency to settle with Moscow on Russian terms. For prices, the read is bearish for pipeline gas economics into China over the medium term. More committed Caspian and Russian eastern capacity competing for the same demand caps the price any single supplier can extract, which is the core of the Moscow-Beijing standoff. The signals in this packet lean bearish, and the mechanism is supply optionality for the buyer.^4,2 The wider context is a Russia that has lost its European market and needs the eastern pivot to work. Power of Siberia 1 brought 38 bcm last year against the 150 bcm-plus Russia once sent west, so the China route is not a like-for-like replacement even at full build-out.¹ That weakness is precisely what gives China the patience to wait. For LNG, a slower Russian pipeline build keeps Asian seaborne demand firmer for longer, with JKM around $18.92 per mmBtu the relevant Asian benchmark rather than any European hub. Pipeline gas that does not arrive on schedule has to be sourced somewhere, and the marginal molecule into North Asia is a cargo.¹ Whether Gazprom and CNPC put a number and a date on Power of Siberia 2, or Beijing keeps signing Caspian capacity instead, is the next signal. The reported $120-130 versus Power-of-Siberia-1 pricing gap is the whole negotiation; until it closes, Turkmenistan's expansion looks like the surer bet on Chinese demand.^2,4