Thursday

16th Aug 2018

Russia to build Nord Stream 2 despite Polish objection

  • Gazprom says it still plans to take delivery of Nord Stream 2 pipes in September, as planned (Photo: turkstream.info)

Russian state firm Gazprom has said that it plans to build the Nord Stream 2 gas pipeline to Germany despite the objections of Polish regulators.

"The decision was we shall not wait … the Nord Stream 2 company does exist, it works”, Alexander Medvedev, Gazprom’s deputy CEO, told Russia’s Tass news agency on Saturday (20 August).

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

"How the foreign counterparts will participate - this is what they will decide themselves," he added.

"They will be searching for options to join the project. We move forward according to the plan. Our counterparts share our vision."

The statement comes after the Polish anti-trust office, the Urzed Ochrony Konkurencji i Konsumentow (UOKiK), in late July declined to approve the notification in Poland of a joint venture to construct and operate the new pipeline on grounds that Nord Stream 2 would restrict competition in gas supplies.

The pipeline is not intended to run through Poland.

But the UOKiK decision prompted the five EU firms that were to take part in the project and that are active in Poland in other areas to abandon the venture in its current model for fear of Polish fines.

The five firms - Austria’s OMV, French firm Engie, Germany’s Uniper and Wintershall, and Anglo-Dutch firm Shell - said in a statement on 12 August that “each of them will … individually contemplate alternative ways to contribute to it”.

A Wintershall spokesman also told Russian news agency Ria Novosti last Tuesday: “We, along with the other applicants, still support the project … We are now studying alternative ways for its implementation”.

But for his part, the UOKiK president, Marek Niechcial, said on 12 August that the Polish ruling was definitive.

“This will stop the [Nord Stream 2] deal”, he said.

The Polish decision means Gazprom will have to itself find the €8 billion that the pipeline is to cost.

But leading Russian banks are currently hampered from raising capital on international markets due to EU and US sanctions over Russia’s invasion of Ukraine.

Gazprom has also become a less attractive borrower - the firm’s market value has shrunk from over $350 billion in 2008 to some $50 billion due to low energy prices and poor management.

The Nord Stream 2 pipeline was designed to carry 55 billion cubic metres of gas a year and to be operational by 2019.

It would concentrate almost all Russian exports to the EU in one route, making it easier for Russia to cut off clients in eastern Europe and harming Ukraine by bypassing its transit network.

The pipeline also needs to be approved by regulators in Denmark, Finland and Sweden because it is to pass through their maritime zones.

Meanwhile, the European Commission has indicated that both its offshore and onshore parts would be subject to EU energy laws.

The EU’s so called third energy package says that firms cannot majority-own supply and distribution assets and must give competitors access to their pipelines.

The laws already saw Gazprom abandon an earlier project, South Stream, designed to bypass Ukraine by shipping gas to Bulgaria.

Column / Crude World

Is Nord Stream II dead?

Russia state-controlled Gazprom plans to build Nord Stream II gas pipeline on its own after partners pull out.

Magazine

Nord Stream 2: Business unusual

Neither sanctions, EU law nor politics can stop the Nord Stream 2 gas pipeline from being built, its small army of European lobbyists has said.

Column / Crude World

Nord Stream 2: The elephant in the room

The European Commission should provide a thorough impact assessment of Nord Stream 2, a project that appears to go against all of its Energy Union objectives.

News in Brief

  1. Salvini questions EU 'constraints' after bridge collapse
  2. Bosnian Serbs to rewrite 1995 Srebrenica genocide report
  3. Malta to allow Aquarius migrants to disembark
  4. Juncker sends condolences over Genoa bridge collapse
  5. EU pledges €500,000 more for Indonesian earthquake island
  6. EU commission in talks with states on new Aquarius migrants
  7. Man held after car crashes into UK parliament security barrier
  8. Brexit delays better readability of medicines' instructions

Opinion

Has the time finally come for 'European champions'?

Since Emmanuel Macron took the French presidency in 2017, the concept of consolidating European industries to create continental 'champions', capable of competing on a global scale, has been revived.

EU 'tax lady' hits Google with record fine

Margrethe Vestager has fined the US tech giant with €4.34bn for abusing its market dominance in mobile operating systems - but assured US president Donald Trump that it is not because she does not like America.

Stakeholders' Highlights

  1. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  2. IPHRCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  3. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  4. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All
  5. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  6. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  7. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  8. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want
  9. Nordic Council of MinistersNordic Countries Take a Stand for Climate-Smart Energy Solutions
  10. Mission of China to the EUChina: Work Together for a Better Globalisation
  11. Nordic Council of MinistersNordics Could Be First Carbon-Negative Region in World
  12. European Federation of Allergy and AirwaysLife Is Possible for Patients with Severe Asthma

Latest News

  1. US trial sheds light on murky Cyprus-Russia links
  2. Burned cars fuel Swedish election debate
  3. EU court to hear citizens' climate case against EU
  4. How long can Bulgaria keep facing both East and West?
  5. EU commission steps up legal case against Poland
  6. Separation of powers instead of 'Spitzenkandidat' process
  7. Revealed: ExxonMobil's private dinner with Cyprus' top EU brass
  8. What Salvini teaches us about Operation Sophia

Join EUobserver

Support quality EU news

Join us