Russia-Germany Gas Pipeline Opposed by US Nears Completion

Dimitri Simes | September 7, 2021 | 6:40pm EDT
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A worker on the Nord Stream 2 gas pipeline’s sector in northeastern Germany. (Photo by Tobias Schwarz/AFP via Getty Images)
A worker on the Nord Stream 2 gas pipeline’s sector in northeastern Germany. (Photo by Tobias Schwarz/AFP via Getty Images)

( – Russia’s controversial Nord Stream 2 natural gas pipeline to Germany is nearing completion despite opposition in the United States and European Union.

Nord Stream 2 AG, the project’s Swiss-registered operating company, announced Monday that it had finished welding the final section of the $11 billion pipeline and expects it to begin operating “before the end of this year.”

Russian Foreign Minister Sergei Lavrov confirmed the news, telling reporters the pipeline, which runs along the Baltic Sea floor, “will be completed in a few days.”

Lavrov said although the U.S. had launched repeated “frontal attacks” against Nord Stream 2 in recent years, it had come to accept the pipeline as inevitable.

“The Biden administration has not changed its position, they are still against this project, but they understand that it cannot be stopped,” he said. “But if you understand that you are obsessed with some unrealizable task, then just common sense should tell you to leave it and do something realistic.”

Ruslan Balbek, a deputy in the State Duma from the pro-Kremlin United Russia party, said Lavrov’s words were “a signal to the entire Western world that one can negotiate with Russia, but ‘fighting’ with it, including over the delivery of energy resources, is useless and counterproductive.”

The 764-mile pipeline is designed to deliver 55 billion cubic meters of natural gas each year from Russia to northern Germany. The project is expected to double the current volume of Russia’s gas exports to Germany, flowing through the Nord Stream 1 pipeline, launched in 2011.

The U.S. and E.U. argue that the pipeline will constitute a geopolitical risk by heightening Europe’s energy dependence on Russia, already the continent’s largest gas supplier.

According to a study released by the European Commission in April, Russia accounted for 48 percent of the E.U.’s total gas imports in 2020, far ahead of second placed Norway at 24 percent.

A key concern is that Nord Stream 2 will allow Russia to bypass Ukraine in delivering its gas to Europe, depriving that country of $2-3 billion in annual transit fees for gas crossing its territory en route to European markets.

In December 2019, Russia and Ukraine signed a five-year gas transit deal, with the option to extend the agreement for another ten years afterwards. Russian President Vladimir Putin said last month gas transit through Ukraine could continue after the current contract expires in 2024, but that the decision will ultimately depend on how much Russian gas the European market will purchase over the coming years.

During the Trump administration the threat of sanctions against companies and individuals involved in the project prompted the Swiss engineering firm Allseas to pull out, bringing construction work to a halt for almost a year.

Work resumed after the U.S. presidential election, and U.S. policy toward Nord Stream 2 began to shift under the Biden administration. Although it echoed its predecessor’s criticism of the pipeline, it argued that additional sanctions were unlikely to prevent the project from being completed and could potentially damage U.S.-German relations.

In May, Secretary of State Antony Blinken waived sanctions against Nord Stream 2 AG and its CEO, Matthias Warning, a German national who is believed to be close to Putin. The decision attracted strong criticism from lawmakers in Congress from both parties.

Two months later, the U.S. and Germany concluded an agreement in which Berlin promised to sanction Russia if it “attempted to use energy as a weapon” against Ukraine. Germany also pledged to lobby Moscow to extend its gas transit contract with Kyiv, and committed to investing at least $175 million in a “Green Fund” to help Ukraine develop renewable energy technologies.

The agreement satisfied neither critics in Congress nor Ukrainian President Volodymyr Zelensky, who continues to call on the U.S. to maintain sanctions against Nord Stream 2.

“The Kremlin has used and continues to use gas supplies as a weapon,” Zelensky told a visiting US congressional delegation on Monday.

See also:

Cruz on Reported Pipeline Deal: ‘Biden Is Defying U.S. Law and Has Utterly Surrendered to Putin’ (Jul. 21, 2021)

Ukrainian Lawmakers Urge Congress to Stop Russia Pipeline, As State Dept. Defends Deal (Jul. 23, 2021)

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