Nord Stream 2 is a problem. But perhaps also an opportunity

There is a strong opposition from Central Europe re Nord Stream 2 project, but for various reasons also Italy is on board with V4. Visegrad Four argues Nord Stream 2 goes against political principles ( Ukraine sanctions) and also EU principles (energy union)  and Germany is heavily criticized? How do you read the situation, do you see any path to compromise on this issue?  Read few comments.

Agata Loskot-StrachotaEnergy Policy Research Fellow, Centre for Eastern Studies 

Indeed there are quite significant differences among Eu member states when it comes to how they perceive Nord Stream 2. Some of them – Germany among them – claim project is purely commercial (it was even stated by Angela Merkel after EUCO), may serve well increasing EU security of energy supply etc. Other – lot of Central European states – claim the opposite.

I think it is really difficult issue to find common ground here, especially as these differences go deeper, reflect different perspectives not only on Nord Stream 2 but also on desired shape of EU gas relations with Russia, and show different priorities with regard to gas market development or energy policy shape. I guess it is indeed hard to find a compromise in such a situation, especially that debate is somehow emotional but at the same time it indeed may represent a chance for European Union institutions to use all available instruments & diplomatic skills in this issue & not only help to define EU common interest with regard to several crucial issues (gas market desired shape and ways of achieving it, EU-Russia relations, etc) but also to reaffirm its own role in it. If EU is unable to do so its role may be undermined by developments which happen de facto without it’s (its institutions) engagement/participation (as Nord Stream 2 project which indeed is a venture of some big companies but a venture which will impact whole EU) but also by the fact of growing differences between member states disabling effective dialogue and/or implementation of other policy goals. So my guess is we indeed need a debate in EU about Nord Stream 2 and what could that mean, what risks are being seen and if there are ways of avoiding them. And I guess that putting that subject on EUCO agenda was a good start but definitely not enough. In a sense it is a perfect starting point for a discussion on what Energy Union objectives (with which any new gas infrastructure should comply according to EUCO conclusions) mean in detail today in security of energy supply & internal gas market field.

Paolo Sorbello, Chief Editor of EnergyBrains.org

Italian PM Matteo Renzi used the issue of Nord Stream-2 to have a chance to question EU sanctions to Russia. Several EU member states now think it is time to resume a dialogue with Russia, in light of the common effort in the conflict in Syria. But none of the member states stopped sanctions from rolling over for another six months on Friday, which says just how powerful the anti-Russian lobby, especially among the Visegrad countries, has become.

There is a strong opposition to the project, but in this low energy price environment Nord Stream-2 makes little sense, especially in light of Russia’s attempt to turn to Asia and the sharp decrease oil Russia’s gas imports from Turkmenistan.

In 2014 Russia sent around 121bcm to Europe (excluding Turkey). This year it might reach a level of 130bcm or so. Nord Stream-2 would add an additional 55bcm, which is different from the 63bcm of the now-shelved South/Turkish Stream project but is still a lot of gas that Russia might not be willing – some say it might not be able – to sell at increasingly lower prices.

Protecting Ukraine as a transit country makes little sense from either side. Russia wants to build alternative routes and reach customers directly, consumer countries should prefer to have a direct link and avoid paying transit fees for the gas.

But if one looks at the picture through a political lens, then NATO members have an interest in keeping Ukraine in the picture and Russia-friendly countries such as Italy, France or Germany all have their own reasons to appease Russia and do so in different ways.

Renzi’s outing against Germany should be read within this framework of political talks.

With hindsight, one can now say that Renzi might have yelled against Germany, but Italian representatives did not stop the sanctions from rolling over anyways.

Nord Stream-2 will be subject to similar regulations as other EU-bound pipelines. It is yet unclear whether Gazprom or the Russian government want to become embroiled in another regulatory mess as they were when they built the first two pipes that currently link Russia and Germany.

I think the debate on this potential pipeline was blown out of its due proportion because of its political significance. For now it’s only an idea, one that could never see the light of the day.

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