At a summit in Shanghai, President Vladimir Putin has signed a 30-year gas deal with China that has been 10 years in the making.
Russia has been keen to find an alternative energy market for its gas due to the possibility of European sanctions over the crisis in Ukraine.
No official price has been given but the deal is estimated to be worth over $US400 billion. It is between Gazprom and China National Petroleum Corp.
in a statement to the Russian news channel Rossiya, President Putin said: "The price is satisfactory for both sides.
"It is tied, like it is envisaged in all our international contracts with Western partners, specifically our partners in Western Europe, to the market price on oil and oil products. It is an absolutely calibrated, general formula for pricing."
Gazprom shares rose 2% on the news.
The agreement is expected to deliver some 38 billion cubic metres of natural gas a year eastward to China, starting around 2018.
The BBC reports the main argument was over the price. Another sticking point was the construction of pipelines into China.
Currently there is one complete pipeline that runs across Far East Russia to the Chinese border. It was started in 2007, three years after Gazprom and CNPC signed an initial agreement in 2004.
China is Russia's largest single trading partner.