Transneft's head Simon Vainshtock told Russian President Vladimir Putin that the first branch of the pipeline would run from Taishet in Siberia's Irkutsk region to the town of Skovorodino, 1,600km to the east, near China's border. "We already have drafts for the project", news agencies quoted Vainshtock as telling Russia's president. Japan and China, both starving for future energy supplies, have fought furiously for the right to access Russia's untapped oil reserves. Tokyo won out after a protracted diplomatic battle over Beijing, when the Russian government late last year sided with the more-expensive but potentially more-profitable Japanese option. Russia's government had initially wanted to run the line to the port of Nakhodka before unexpectedly changing its mind and deciding to end the pipeline at Perevoznaya  a decision that prompted fury from environmentalists because the port is marked as a nature reserve. The Chinese line had been backed by the Yukos oil company, which Russia is controversially dismantling to pay off back taxes. Russia now has only a vague commitment to build a branch from the Japanese pipeline to China by 2020. But Moscow officials have hinted that Beijing would have to come up with the financing if it wanted the oil. Deputy Prime Minister Viktor Khristenko pointed out in a recent interview with the Vedomosti daily that Skovorodino, the intermittent point, lies only 70km north of the Chinese border. "An option for a Chinese branch still remains," said Khristenko, who holds Russia's energy brief. Financing for the Japanese branch also remains unclear, the Russian government announcing in late January that it would not guarantee any loans for the project. The statement was issued three days after talks on the pipeline between visiting Japanese Foreign Minister Nobutaka Machimura and Khirstenko. Khristenko said Russia expected "cheap loans from both within and abroad" to build the pipeline. The project is estimated to cost $12billion, although some analysts have forecast a price of $16billion, and possibly more. Tokyo has offered to provide $7billion in soft loans for the pipeline, and make further investments in Far Eastern Russia, which has been shunned by Japanese companies because the two nations have yet to sign a peace treaty ending World War II due to a lingering border dispute. The Kommersant business daily has reported that Russia may give Japanese companies the right to develop new oilfields in Siberia, but that a final decision still had to be made by the government. No Russian company or bank has yet volunteered to help construct the pipeline, which would be operated by Transneft.