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Nord Stream 2: Why the pipeline is so controversial

2021-07-21T09:02:36.086Z

The project is worth billions, as are the sanctions threats from Washington: For years there has been a dispute over the Nord Stream 2 pipeline in the Baltic Sea. What's behind it? The overview.



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Map showing the course of Nord Stream on a container in Lubmin

Photo: Stefan Sauer / dpa

The conflict has been simmering for years, but now a compromise seems to be within reach: The USA and Germany are apparently on the verge of reaching an agreement on the Nord Stream 2 Baltic Sea pipeline. What is the conflict about?

The most important facts:

What is Nord Stream 2?

The pipeline is to transport natural gas from Russia to Germany, it starts in Vyborg, Russia and ends in Lubmin near Greifswald.

The 1200 km long pipeline runs through the bottom of the Baltic Sea and is operated by the Russian company Gazprom.

Two strands of the pipeline were inaugurated under the name Nord Stream 1 in 2011.

The Nord Stream 2 extension is about to be completed.

Why is the project being criticized?

Nord Stream 2 could make Europe more dependent on Russia's gas: Both the USA and previous transit countries for Russian gas, particularly Ukraine, are expressing this concern.

In the past, there have been repeated disputes between the Ukrainian and Russian governments over gas deliveries, and Gazprom even completely stopped its deliveries to Ukraine at times.

Poland and the Baltic countries also strictly reject the project, which reminds them of Moscow's hegemonic role during the Soviet Union.

The Russian annexation of Crimea and, most recently, the poisoning and imprisonment of the Kremlin critic Alexei Navalny are adding to such concerns.

The EU Commission, however, argues that it simply wants to open up as many options as possible for energy supplies.

Russian gas is just one of them.

What is the role of the USA?

The Washington government has repeatedly criticized Nord Stream 2 in the past.

In 2019, the US Congress passed sanctions against companies and individuals involved in construction.

Last year, US senators even threatened employees of the Saßnitz ferry port on Rügen with serious consequences because it plays an important role in the construction work.

The Americans argue that Nord Stream makes Germany too dependent on Russia.

However, they also have an interest in selling natural gas themselves.

In the pipeline dispute, ex-US President Donald Trump successfully urged the Europeans to commit to purchasing liquefied natural gas (LNG) from the US.

The rhetoric has changed under Trump's successor, Joe Biden.

He lifted the sanctions from May to August to give both sides time to negotiate.

Biden argues that the pipeline was 95 percent complete when he took office.

"Sanctions made no sense there," he justified the move last week.

Instead, he decided to work with Germany.

What is the German position like?

Despite the US threats and complaints from Eastern Europe, the federal government is sticking to Nord Stream 2 to this day.

At a meeting with Biden last week, Chancellor Angela Merkel emphasized that the pipeline was an additional project and not an alternative to gas transit through Ukraine.

"Our understanding was and is and will remain that Ukraine remains a transit country for natural gas."

Another argument from German politicians: If the project were to be abandoned, relations with Russia could deteriorate further and President Vladimir Putin could cooperate more closely with China.

In addition, the purchase of natural gas is defended because it is seen as a bridging technology in the transition to renewable energies.

Last but not least, financial considerations also play a role: If the project, which cost around ten billion euros, is abandoned, there is a risk of high claims for damages.

What could a compromise look like?

Germany and the USA have now apparently agreed to take sanctions against Russia if it should use the gas pipeline to harm Ukraine or other Eastern European countries.

How exactly these should look like remains open, however, reports the Bloomberg agency, which has the written draft of the agreement.

According to the Wall Street Journal, the US government is keeping sanctions against the Russian energy sector open even after the pipeline has been built.

In addition, under the agreement, Germany has committed to investing $ 175 million in a fund to promote the expansion of clean energy in Ukraine.

In addition, Germany wants to work to ensure that the transit contract between the Russian Gazprom Group and Ukraine, which runs until 2024, is extended.

Ukraine would then continue to benefit from billions in transit fees for Russian gas.

dab / hej / dpa / Reuters

Source: spiegel

All business articles on 2021-07-21

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