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High chances for Russia to build Nord Stream-2 gas pipeline to Europe - experts

December 01, 2015, 19:18 UTC+3 Alexandrova Lyudmila
© ТАSS/EPA/FILIP SINGER

MOSCOW, December 1. /TASS/.  European countries objecting to the construction of the third and fourth stages of Russia’s Nord Stream gas pipeline will hardly be able to impede the implementation of this project supported by Germany and large European companies, Russian experts say.

Chances are high for Russia to carry it through, they say.

Nine European countries have sent a letter to European Council President Donald Tusk with a demand to include the Nord Stream-2 project implementation in the agenda of the EU summit in December, The Financial Times reported.

The countries that made this demand included Slovakia, Hungary, Poland and the Baltic states. In their opinion, the Nord Stream-2 project implementation "will strengthen Europe’s dependence on Russian natural gas," which "contradicts the EU policy for energy security and diversification."

The United States is also objecting to the decision to build the Nord Stream-2 gas pipeline from Russia to Germany: the Obama administration has openly spoken against the project.

The Nord Stream-2 project envisages building the gas pipeline’s third and fourth stretches to add another 55 billion cubic meters to its capacity. The project’s consortium comprises Gazprom, OMV, Shell, BASF/Wintershall, Engie and E.On.

Energy Development Fund Director Sergei Pikin said he was confident in the viability of the Nord Stream-2 project.

"From the viewpoint of Brussels bureaucracy, a major violation stemmed from Gazprom’s participation in the construction as a shareholder of a part of the EU gas transportation system," the Free Press web portal quoted the expert as saying.

"The Nord Stream ideology is quite different: our company forms a consortium with European partners to build the pipeline’s underwater stretch, which does not fall under the Third Energy Package. We extend the pipeline to the coast in the area of Greifswald while Europeans build the entire ground infrastructure," the expert said.

As for protests by some European countries, it should be taken into account that Poland and the Baltic states "are our traditional energy spoilers in Europe, which are fulfilling Washington’s geopolitical order," he added.

"They have now built loss-generating regasification terminals and are beginning to buy US liquefied shale gas. Of course, Washington and new EU members [from among former socialist camp countries] loyal to it will exert all possible pressure on Berlin."

The countries that have written a letter to Tusk are mostly offended states, which do not want to lose their transit advantages, leading analyst of the National Energy Security Fund Igor Yushkov told TASS.

"When Russia was saying that it would give up gas transit across Ukraine after 2019, these countries understood that they might get a piece of a ‘transit pie.’ Irrespective of whether the talk was about the South Stream or the Turkish Stream project, it was presumed that the gas pipeline would run across the territory of Eastern and Southern European countries. As for the Baltic states and Poland, they always join all anti-Russian sanctions. Besides, Lithuania and Poland have already built LNG terminals and signed long-term contracts with the suppliers of expensive US LNG and it is advantageous for them to see the smallest possible volume of Russian gas coming to the European market so that the market prices there grow to match the prices they have to pay," the expert said.

At the same time, the Nord Stream-2 project will be supported by Germany, which will become a transit country and actually a gigantic gas hub, he added.

"The point is that the additional volume of about 55 billion cubic meters that will be pumped via the Nord Stream 2 gas pipeline will be distributed all across Europe. The Nord Stream 1 pipeline is also expected to be loaded at full capacity," the expert said.

Gazprom is currently taking part in gas sale auctions to get out of the restrictions imposed by the Third Energy Package, Yushkov said.

Natural gas is sold at the border where it is purchased by traders. So, it turns out that already European gas is pumped farther via the pipeline and, consequently, the OPAL pipeline now only 50% filled with Gazprom’s gas can also be loaded to a greater capacity, the expert said.

Apart from Germany, large European companies operating on the gas market are interested in the Nord Stream-2 project implementation, he added. "Big European business will also actively lobby its interests. Of course, they will exert pressure on the European Commission."

However, it was the Bulgarian government and not the European Commission that blocked the South Stream gas pipeline project, the expert said.

"The Bulgarians revoked the issued permission for the construction after a 30-minute talk with US senators. But Germany is not Bulgaria and has much more potential to resist pressure. Germany understands that the United States pursues its own economic interests in this case," the expert said.

"In these conditions, chances are quite high to build the Nord Stream-2 pipeline," the expert added.

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