Nord Stream-2, the project to build a pipeline running from Russia to Germany under the Baltic Sea is moving forward now that the project has received almost all of the required environmental licenses to operate in Europe.
To date, Germany, Finland and Sweden have granted all the necessary permits for the construction and operation of the planned pipeline, leaving only Denmark in the process of granting permits.
Speaking to New Europe, Russia’s envoy to the EU Vladimir Chizhov said he optimistic that the plan will move forward. In an interview on the sidelines of a conference on June 15 in Lagonissi, south of Athens, Chizhov said he is “Quite confident” that Nord Stream-2 would be built despite opposition from certain Central European states and the Baltics.
Nord Stream 2, similar to the pipeline in operation, will establish a direct link between Gazprom and the European consumers, Russian gas monopoly Gazprom has said, adding that the pipeline will also ensure a highly reliable supply of Russian gas to Europe. This is particularly important now when Europe sees a decline in domestic gas production and an increasing demand for imported gas.
“Actually, quite recently, Sweden gave the green light. So there is actually one country remaining (to grant the needed operational permits), which is Denmark. But Denmark can be physically circumvented. This could, perhaps, result in an increase in the (overall) cost and possibly in the timing, but this is something that does not constitute an insurmountable obstacle,” Chizhov said.
The planned course of Nord Stream-2 crosses the territorial waters of Denmark, around Bornholm Island, rather than the country’s Exclusive Economic Zone.
In Russia, Nord Stream 2 needs to obtain two main permits. On June 7, Nord Stream 2 received the construction permit for the Russian section of the planned pipeline from the Russian Ministry of Construction and Utilities. It also needs a permit for construct of an underwater pipeline in the territorial sea of the Russian Federation will be obtained from the Russian Environmental Authority (Rosprirodnadzor).
Regarding an amendment to the European gas directive, which is aimed at halting the construction of Nord Stream-2, Chizhov argued that the European Commission is divided.
“DG Energy wants to extend the proposed Amendments to the Gas Directive to projects like Nord Stream, whereas the legal service of the Commission, plus the legal service of the Council, they are against that. And the positions of the Member States, as far as I know, are divided so this thing is hanging in the air,” said Chizhov.
The European Commission has insisted that Russia maintain the existing Ukrainian gas transit route after 2019, when the current transit agreement with Russia expires and Nord Stream-2 is scheduled to go online. Moscow has recently indicated that it might still transit some gas through Ukraine.
“Well, nobody is saying that it will stop. There are certain countries downstream like Moldova, for example, which do not have any other option than to receive gas through Ukraine. The issue there is that the Ukrainian authorities are playing with the prospective change in the transit fees after 2019, when the 10-year contract ends,” Chizhov said, adding that this may result in Ukrainian transit becoming prohibitively excessive in terms of cost. “If you look at the map, either Nord Stream-1 or 2 cover shorter distances (than the routes through Ukraine)…the difference is 1,500 kilometres. That’s substantial. Also the pipes which were laid across Ukraine in the 1970s are so old and the pumps consume as much as gas as they are able to transport,” he said, laughing.
The total capacity of two strings of Nord Stream 2 is 55 billion cubic metres of gas per year. The aggregated design capacity of Nord Stream and Nord Stream 2 is therefore 110 billion cubic metres of gas per year.
Chizhov also pointed out that the European Commission’s antitrust case against Gazprom has been settled under a compromise deal. “Gazprom undertook certain commitments voluntarily and the Commission accepted them, provided that Gazprom lives up to those commitments, no fines will be raised.”
The United States and a number of Central and East European states have ramped up their opposition to Nord Stream-2, Chizhov said.
“You know. when Nord Stream 1 was built there was an outcry from certain quarters in the West. In Scandinavia, for example, (they were saying) that Russia will build artificial islands in the Baltic Sea, under the cover of (Russian President Vladimir) Putin, pumping stations; they will create naval facilities and so on. That’s ridiculous – as ridiculous as what an American representative from the State Department, Mrs (Sandra) Oudkirk, was saying that beware the Russians will use Nord Stream for espionage purposes,” Chizhov said.
In May, Reuters quoted Oudkirk, the US Deputy Assistant Secretary of State for Energy Diplomacy, as saying that Nord Stream-2 raises US intelligence and military concerns since it would allow Moscow to place new listening and monitoring technology in the Baltic Sea, a notion that Chizhov laughed off as pure fiction.
”I immediately remembered a James Bond film – ‘The Living Daylights’, it was called – when they put an agent in a capsule, in Bratislava actually,” he said laughing, “and sent him off to Austria.”