Russia's aggressive moves in Ukraine have led to some deals that might not have otherwise happened. One of the biggest being an agreement to send Russian natural gas to China. That gives Russia a market into which to sell gas if energy relations with Europe should become even more problematic. However, it's only a drop in the bucket for China, which needs roughly 10 times as much gas to satisfy its massive energy needs.

A deal made under pressure
After annexing Crimea, Russia has begun to push its luck with the rest of Ukraine. That's got the West more than a little bit upset. Although sanctions so far have been relatively light, they have targeted Russia's all-important energy industry. That sector alone accounts for about half of the country's federal budget revenues.

(Source: By "Myself", via Wikimedia Commons)

And Europe is a huge customer. For example, state controlled Gazprom OAO (OTC:OGZPY) sells roughly half of its natural gas to Europe. For comparison, Russia accounts for about 30% of its sales -- making Europe more important than Russia to the company's top and bottom lines. So Russia's Ukrainian activities are a big deal for Gazprom, and Russia, should Europe decide to really inflict some pain.

That's why Russia signed a long stalled deal with China to supply the world's most populous nation with 1.3 trillion cubic feet of natural gas a year. The deal is worth roughly $400 billion, with the gas starting to flow in 2018. It's Gazprom's largest deal ever. And it's a lot of gas, but it pales in comparison to the amount that China actually needs.

A tiny deal
The U.S. Energy Information Administration, for example, projects that China's gas demand will more than triple by 2040. Russia's contribution to the natural gas pie in 2040? A touch over 7%. The EIA expects China's domestic production to increase by 6.3 trillion cubic feet.

So the Russian deal is clearly important for Russia, but it's less important for China. As an investor, you should probably look at other ways to play natural gas growth in China. For example, liquefied natural gas imports are expected to increase by 3.1 trillion cubic feet by 2040, expanding more than five-fold from today's 0.7 trillion cubic feet of supply entering the nation.

Source: EIA

This is one reason why U.S. LNG plays have such potential. A balanced way to get in on global LNG demand is Dominion Resources (NYSE:D), which has customers lined up for a planned LNG export hub and is well along the way toward export approval. Although the customers aren't Chinese, LNG demand from China should lead to supply constraints that will make toll-taker businesses like an export terminal highly valuable. It would ensure healthy demand, full utilization, and expansion potential. Meanwhile Dominion's other businesses provide a counterbalance should LNG demand not take off.

That said, a more direct play on Chinese gas supply is Halliburton (NYSE:HAL). The company recently formed a partnership with China's STP Energy Group. Halliburton will own 49% of the newly formed entity that's expected to explore for oil in the Xinjiang desert. This region holds roughly a third of China's unconventional energy reserves.

These unconventional reserves require expertise with hydraulic fracturing, and that happens to be a Halliburton specialty, particularly when it comes to water conservation -- a key plus when working in a desert. Although this deal isn't exactly huge, it gives Halliburton, and its shareholders, an important stake in supplying China's growing appetite for fuels like natural gas.

Russia ain't so big
When it comes to headlines, the Chinese/Russian natural gas deal was huge. However, when put into context, it's really not so big, at least for China. That's why you should consider other, more important sources of natural gas supply. Investing in a U.S. LNG export player should be a safe way to tap China's long-term gas demand, essentially taking advantage of the global impact it will have. However, buying Halliburton will provide direct exposure to Chinese unconventional resources, of which natural gas will be an increasingly important part.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.