Chinese President Xi Jinping and Russian President Vladimir Putin resumed high-stakes negotiations on the long-stalled Power of Siberia 2 natural gas pipeline during a bilateral meeting on Monday at the Shanghai Cooperation Organisation summit in Kyrgyzstan.

Kremlin foreign policy aide Yury Ushakov confirmed Friday that the flagship energy project will feature prominently during talks in Bishkek.

Ushakov added that discussions will continue at the Eastern Economic Forum in Vladivostok, where Chinese Vice-Premier Ding Xuexiang will meet with Russian officials.

The proposed 1,616-mile (2,600-kilometer) pipeline represents a major strategic priority for Moscow as it seeks to pivot energy exports away from Western markets.

First proposed in 2006, the conduit is designed to deliver 50 billion cubic meters of natural gas annually from Russia’s Yamal Peninsula in the Arctic through Mongolia into northern China.

While Russian Deputy Prime Minister Alexander Novak indicated in May that contract terms were near completion, Beijing has maintained a cautious stance, avoiding public commitments regarding pricing and supply guarantees.

A senior Russian official said in June that the project’s delay stems from logistical challenges, not pricing. However, earlier reports indicated that China sought a heavy discount, similar to that of Russia’s local market.

Securing overland energy channels has taken on added urgency for Beijing amid escalating geopolitical friction in the Middle East.

With Iran restricting transit through the Strait of Hormuz—a maritime chokepoint handling roughly half of China’s seaborne crude imports—the pipeline offers a land-based buffer against maritime supply disruptions.

The energy talks unfold against a backdrop of complex international tensions. The summit brings together leaders from across Eurasia as Western nations intensify economic pressure on Tehran and Moscow.

Recent U.S. sanctions targeting entities linked to Iranian trade have added strain to Washington's relations with Beijing, highlighting China's drive to solidify overland trade routes with Russia and Central Asia.

If finalized, Power of Siberia 2 would significantly deepen the economic axis between Moscow and Beijing, consolidating Russia’s role as China’s primary natural gas supplier while insulating both economies from Western trade sanctions and maritime choke points.