Chinese oil giants 'in Russian talks'

A crude oil pipe line linking Russia with China could be built

Russia's second largest oil company, Yukos, has reportedly entered discussions about joint gas and oil exploration in Siberia with China's two state owned oil giants.

"We are discussing with the China National Petroleum Corp (CNPC) and China Petrochemical Corp (Sinopec) to tap oil and gas resources in Russia," Yukos official Yevgeniy Novikov said according to China Daily.

Yukos would allow CNPC and Sinopec, along with other foreign companies, to own up to 50% of oil fields in two Siberian regions; Sakha and Krasnoyarsk, said the company's vice president of exploration and new ventures, Tay Leonard to the newspaper.

If deals are completed, a crude oil pipeline could be built between 2003 and 2005 with the aim of pumping 20 million tonnes of oil each year from Tomsk in Siberia to Daqing in China, the newspaper reported.

West Siberia already accounts for almost 70% of Russia's oil output.

Yukos has reportedly signed a memorandum of bilateral cooperation with Sinopec.

The memorandum has "fixed Sinopec's interest in the significant long-term delivery of Russian oil, and therefore participation in a feasibility report for the Russia-China pipeline," the Siberian Research Institute of Geology's Oleg Krasnov told the paper.