Page 6 - FSUOGM Week 20

FSUOGM COMMENTARY FSUOGM
Germany denies Nord Stream 2
a waiver from EU law
Gazprom’s new pipeline to Europe will have to comply with EU unbundling rules
EUROPE
WHAT:
German regulators have denied Nord Stream 2 a waiver from EU gas law.
WHY:
The decision means the pipeline will have to comply with EU rules on unbundling, transparent tariffs and third-party access.
WHAT NEXT:
Gazprom is likely to seek a creative solution to the setback.
GERMAN energy regulator Bundesnetzagentur has denied Russia’s Nord Stream 2 gas pipeline a waiver from EU energy rules, marking another setback for the divisive project.
The decision means that Russian state gas company Gazprom will have to cede control of the pipeline, ensure that third parties can access its capacity and set transparent tariffs.
The EU introduced an amendment to its gas legislation last year, extending EU energy law to pipelines running between the bloc and third- party countries such as Russia. The amend- ments only apply to projects completed after the amendment came into force on May 23, 2019.
Gazprom argues that Nord Stream 2 should be treated as having been finished at this point, as it was already a finalised investment and con- struction was well underway. But Bundesnet- zagentur, consulting with other EU member states, disagreed.
“Since the Nord Stream 2 pipeline had not been fully laid by May 23, 2019, the Bundesnet- zagentur has rejected the application for der- ogation made by Nord Stream 2,” it said in a statement on May 15. “When it is put into oper- ation, therefore, Nord Stream 2 will be subject to German regulatory requirements and European rules on unbundling, network access and cost regulation.”
Nord Stream 2 aims to pump up to 55bn cubic metres per year of Russian gas under the Baltic Sea to Germany, helping Gazprom limit transit flows through Ukraine. The pipeline was meant to come on stream before the end of last year, but construction was delayed, first by per- mitting issues in Denmark and then by the US sanctions, which led Swiss-based pipelayer All- seas to abandon the project in December.
The pipeline’s launch is now scheduled for early 2021, Russian President Vladimir Putin has said. Gazprom is expected to use its own pipelayer, the Akademik Cherskiy, to finish the remaining 6% of Nord Stream 2’s offshore section.
Gazprom bought the Chinese-built vessel in 2016, as a back-up option in case international contractors were unable to finish Nord Stream 2. The ship is now stationed at the German port of Mukran, having left the Russian Far East in mid-February and journeyed through the Asia-Pacific region and around Africa to get to northern Europe. Gazprom has been using a facility near Mukran to store Nord Stream 2’s pipes over the years.
Reactions
The Nord Stream 2 operating company, wholly owned by Gazprom, told NewsBase in
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w w w . N E W S B A S E . c o m Week 20 20•May•2020