Ukraine crisis threatens Russian pipeline plans

In response to the Crimea crisis, EU Energy Commissioner Guenther Oettinger announced he is to delay talks with Russia on the South Stream gas pipeline that would export Russian gas via the Black Sea. The South Stream line strategically bypasses Ukraine, which currently hosts the main arteries for export of Russian gas. (Reuters, March 10) The European Commission has already postponed discussion of the OPAL pipeline, part of the Nord Stream project, which similarly bypasses Ukraine via the Baltic Sea. (Voice of Russia, March 11) Russia's giant Gazprom, which uses the existing Nord Stream line to send gas to Germany, plans to start shipments to Europe through the South Stream line at the end of 2015. Russia is seeking to boost gas exports to Europe as much as 23% over the next 20 years. (Bloomberg, March 12)

  1. Trump approves sanctions on Russia gas pipeline

    President Donald Trump has signed a law that will impose sanctions on any firm that helps┬áRussia’s state-owned gas company, Gazprom, finish a pipeline into the European Union.┬áThe sanctions target firms building Nord Stream 2, an undersea pipeline that will allow Russia to increase gas exports to Germany.┬áThe US considers the project a security risk to Europe. (BBC News, Dec. 22)

  2. EU court rejects Nord Stream legal challenge

    Russia’s Nord Stream 2 gas link developer lost its court case against changes that apply European Union gas market rules to the EU section of offshore links with non-EU countries. At issue is the┬áEU’s Directive 2019/692, passed in May 2019, which requires that bundled gas pipelines owned by the same company running between a member state┬á(in this case Germany) and a third country┬á(in this case Russia) must open the pipelines to access by third parties. A Russian company, PJSC Gazprom, owns 51% of Nord Stream AG and wholly owns Nord Stream 2 AG. Nord Stream AG’s┬ápipeline has been carrying gas from Vyborg, Russia, to Lubmin, Germany, since 2012. In 2017 Nord Stream 2 AG began construction on the second pipeline, which runs┬áparallel to the first.

    The EU gave member states until February 2020 to incorporate Directive 2019/692 into national law. By this time, Nord Stream 2 AG had completed about 95% of the new pipeline. Nord Stream 2 AG had completely funded the new pipeline’s construction. The two companies filed suit arguing that Directive 2019/692 should be annulled, because the companies were discriminatorily targeted by the directive. The EU General Court rejected this argument. The companies may file an appeal. (Jurist,┬áS&P Global)