MOSCOW: Russia's energy giant Gazprom said Tuesday that China will start paying for Russian gas in rubles and yuan instead of US dollars, as Moscow seeks closer ties with Beijing in the wake of Western sanctions over Ukraine.
"A transition was made to making payments for Russian gas supplies to China in the national currencies of the countries -- the ruble and yuan," Gazprom said in a statement.
"The new payment mechanism is a mutually beneficial, timely, reliable and practical solution," Gazprom CEO Alexei Miller said as quoted in the statement following a video conference meeting with the head of China's oil group CNPC, Dai Houliang.
Miller added that it will "simplify calculations" and "become an excellent example for other companies".
Miller informed his Chinese counterpart of the "status of work on the project for gas supplies via 'the eastern route' -- the 'Power of Siberia' gas pipeline" which connects the Russian and Chinese gas networks, Gazprom added.
The energy giant said gas from the under-developed Kovykta field will start flowing through Power of Siberia "before the end of the year", allowing for the "increase (in) the volume of gas deliveries to China in 2023".
Following the imposition of economic sanctions over the Kremlin's offensive in Ukraine, Russia has reduced or halted supplies to different European nations, causing energy prices to soar.
It has also sought to bolster ties with allies in Asia -- especially China -- and boost natural gas deliveries to markets outside Europe.