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Nord Stream: Will the Baltic Sea pipelines ever be able to transport gas again?


Denmark and Sweden speak of sabotage: The Nord Stream pipelines are losing gigantic amounts of natural gas. What that means for shipping and the environment - and what speaks for a state attack: the overview.

Enlarge image

A photo of the gas escaping in the Baltic Sea, taken from a Danish military aircraft

Photo: Danish Defense Command / HANDOUT / EPA

Gas is leaking from the Nord Stream 1 and Nord Stream 2 pipelines in the Baltic Sea.

Who is responsible?

And what does that mean for gas prices?

What we know - and what is unclear.

What happened?

After an initial drop in pressure on Monday night, a total of three leaks were discovered by Tuesday, one in one of the Nord Stream 2 tubes and one in each of the two tubes of the Nord Stream 1 pipeline.

All three leaks are located near the Danish island of Bornholm: the leak in the Nord Stream 2 pipeline is southeast, the leaks in Nord Stream 1 are northeast of the island.

Large amounts of gas are now flowing into the Baltic Sea at the affected points, and ships have to bypass the area over a wide area.

The damage is apparently greater than initially assumed.

According to SPIEGEL information, the lines must have been torn open over a longer length.

Through Nord Stream 1, Russia had supplied natural gas to Germany by August 31, Nord Stream 2 was completed but never put into operation because of the Russian war of aggression against Ukraine.

The pipeline had only been filled with gas once.

How could the leaks have arisen?

Like other countries, the EU and NATO, Denmark and Sweden assume sabotage.

In Denmark, the authorities had come to the clear conclusion that the acts were intentional and not an accident, said Prime Minister Mette Frederiksen.

Several explosions were observed within a short period of time.

The federal government does not believe in a coincidence either, as an insider told SPIEGEL.

According to SPIEGEL information, the United States warned Germany weeks ago of possible attacks on gas pipelines in the Baltic Sea.

A seismic measuring station on Bornholm also registered two events this week that, according to experts, cannot be attributed to earthquakes.

First, the curve shot up abruptly in the measuring range from two to eight Hertz early Monday morning at 2:03 a.m., later again at 7:04 p.m.

In both cases, there was increased noise for hours afterwards (read more about this here).

Almost no one believes in an accident at the moment.

The operator of Nord Stream 2 had stated that the lines were laid in such a way that it was highly unlikely that several lines would be damaged at the same time, for example by a single ship accident.

According to experts, the lines are also about 70 meters deep and are very robust, made of steel and concrete.

Who could be behind this?

If it was an attack, only a state actor would come into question in view of the effort, it said.

One motive could be to stir up uncertainty on the European gas market - but who is really behind it and why is completely unclear.

Ukraine and some European politicians blame Russia for the leaks: It was a "terrorist attack planned by Russia," wrote Ukrainian presidential adviser Mykhailo Podoliak on Twitter.

Kremlin spokesman Dmitry Peskov called such accusations "stupid."

Peskov also did not rule out sabotage, but sees Russia as a victim: Nord Stream 2 was ready to pump gas, and now the expensive gas is flowing into the air, he said.

Russian media, on the other hand, see responsibility in Ukraine or the USA.

How is the international community reacting?

One leak in the Nord Stream 1 pipeline is in Danish waters and the other in Swedish waters.

The Nord Stream 2 leak is in Danish waters.

Crisis teams have now been convened in both Denmark and Sweden.

However, both countries emphasize that their territory was not attacked.

The incidents occurred in international waters in the exclusive economic zones of both countries.

In the EU, there are concerns about possible sabotage – according to SPIEGEL information, the security concepts are now also being examined for other pipelines and gas supply systems.

Norway has announced that it will increase safety precautions at its oil facilities, but does not see the oil and gas facilities in any specific danger.

The Danish government is concerned about the security situation in the entire Baltic Sea region and accuses Russia of saber-rattling in the region.

The EU has already threatened countermeasures if the sabotage theory is confirmed.

Any intentional disruption to Europe's energy infrastructure will "be answered with a robust and joint response," said EU foreign policy chief Josep Borrell.

Are the leaks dangerous?

The exact composition of the escaping gas is not known.

However, the main component of natural gas is methane.

According to the Federation for the Environment and Nature Conservation (BUND), animals could suffocate near the leaks, but the Federal Ministry for the Environment sees no direct danger to the marine environment.

However, the Ministry, the German Environmental Aid (DUH) and the BUND see a climate risk from the escaping methane: the substance is 25 times more harmful to the climate than CO2.

The leaks can also be dangerous for ships: According to the Danish Energy Agency, ships can lose buoyancy if they enter the area.

There is also a risk of ignition.

Ships therefore have to bypass the area.

According to the authorities, there is no danger outside the zone, not even for the residents of Bornholm and the small neighboring island of Christiansø.

How much gas was in the lines and who owns it?

According to SPIEGEL calculations, it could be a good 500 million cubic meters of gas.

This is how much Germany consumes on average in two days.

At the current prices on the EU gas market, this amount would have a market value of more than 800 million euros.

According to a market insider, the gas from Nord Stream 1 most likely belongs to the Russian state monopoly Gazprom - in the case of Nord Stream 2, this is said to be the case indirectly: According to an insider, Nord Stream 2 AG from Switzerland should own the gas, this company belongs to Gazprom 100 percent.

If large amounts of gas are now lost, Nord Stream 2 AG could finally face bankruptcy.

What does that mean for the gas supply?

No gas has flowed through Nord Stream 1 since September 1 – and Nord Stream 2 has never been put into operation.

Nevertheless, prices on Europe's gas exchanges have recently fallen, and German gas storage facilities are more than 90 percent full.

Unless it gets extremely cold or there are major supply disruptions, for example from Norway or the USA, a gas shortage in Germany this winter is unlikely from today's perspective.

However, things could possibly get tight again in the winter of 2023/24 when Russia stops supplying gas.

In the first months of this year, Gazprom still exported large quantities of natural gas to Europe, which made it possible to fill the storage facilities.

Are gas prices going up even more now?

That's not clear yet.

In European wholesale, prices have fallen steadily in recent weeks.

On Tuesday, the prices for a megawatt hour of natural gas for delivery in October on the Dutch reference market rose again slightly, but this Wednesday they fell again a little by midday.

What's next?

According to the Danish government, the inspection of the leaks will probably only be possible in one to two weeks.

Danish Defense Minister Morten Bodskov made it clear that the current pressure in the pipes and the amount of gas leaking are hampering the inspection.

The Navy of the Bundeswehr is to help with the inspection: "Our Navy will contribute its expertise to the investigation," said Federal Defense Minister Christine Lambrecht.

In the long term, the question arises as to whether the pipelines will ever go back into operation.

A repair could be expensive, if at all possible.

The "Tagesspiegel" reports that the pipelines could corrode when salt water runs in, so they would have to be repaired quickly.

But it is unclear who would pay for it at all.

As long as the federal government rules out the commissioning of Nord Stream 2, it is unlikely that Gazprom will invest large sums in the restoration.

With Nord Stream 1, the chances are generally higher - but it is unclear whether Russia and Germany would be interested in restarting it.


Source: spiegel

All business articles on 2022-09-28

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