Troubled Nord Stream 2 Pipeline Edges Closer to Completion

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Russia has said work on the controversial 1,230-kilometer (km) Nord Stream 2 gas pipeline into Europe is almost complete.

Work on the pipeline came to a halt at the beginning of this year after the U.S. imposed sanctions on any company working on the project. Now, Russian Energy Minister Alexander Novak has said that about 5% of the total cost of the project remains.

"This is a commercial project, implemented by several global companies," Novak told media. "Given that a huge amount of money has been invested and there are very few investments left, about 5% of the total cost of the project, I think that this project will be implemented."

Nord Stream 2 consists of two parallel pipelines running 1,230 km for the transport of gas from Russia via Germany to Europe. It passes through Finnish, Swedish, Danish and German marine areas before going ashore at the German coast. The pipelines can transport 55 billion cubic meters (Bcm) of natural gas per year, doubling the capacity of the existing Nord Stream pipeline. Russia's oil and gas major Gazprom (PINK:OGAZPY) (Moscow) holds a 50% stake in the 9.5 billion-euro ($10.5 billion) pipeline, and the rest is owned by five European Union (EU) shareholders, including Royal Dutch Shell plc (NYSE:RDS.A) (The Hague, Netherlands), OMV AG (OTC:OMVKY) (Vienna, Austria), BASF/Wintershall (Ludwigshafen, Germany) and ENGIE (EPA:GSZ) (Paris, France).

Novak's confidence was mirrored by Germany's Ambassador to Moscow Geza Andreas von Geir, speaking to Interfax: "I continue to assume that this project [Nord Stream 2] will be implemented, as it's designed for a long-term period. The companies participating in its implementation will evaluate how the current crisis will affect it. For us, the Nord Stream 2 project is an element of our diversified sources of energy, of our energy policy, and thus, it's important for the energy security of Germany and other European countries. Germany rejects exterritorial sanctions, including those imposed by the United States in relation to the Nord Stream 2 project. As for this issue, Germany advocates a point of view that differs from that of the U.S."

In January, U.S. sanctions forced Swiss-based pipe-laying and decommissioning firm Allseas, which is responsible for pipe-laying on the Nord Stream 2 and TurkStream gas transit projects, to stop working both projects to comply. Both of the Allseas pipe-laying vessels Pioneering Spirit and Solitaire--the biggest vessels of their class in the world--were key to finishing Nord Stream 2. Last month, Russia moved the Academician Chersky pipe-laying vessel from its Pacific coast to the west in preparation to complete the Nord Stream 2 pipeline after refitting work is completed. For additional information, see January 6, 2020, article - U.S. Sanctions Stop Nord Stream 2 Pipe-laying.

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