Construction of the world’s most controversial natural gas pipeline is about to enter the endgame of an energy dispute that's pitted the U.S. against Russia and some of its closest trans-Atlantic allies, satellite images show.
The Nord Stream 2 pipeline, built to increase the flow of Russian gas into Germany, Europe's biggest economy, was thwarted five months ago after U.S. President Donald Trump imposed sanctions that forced workers to retreat. Now, after a three-month voyage circumnavigating the globe, the Akademik Cherskiy, the Russian pipe-laying vessel that's a prime candidate to finish the project, has anchored off the German port where the remaining pipeline sections are waiting to be installed, according to Bloomberg.
Nord Stream 2 AG, the project operator owned by Russia's Gazprom PJSC and financed by some of Europe's biggest energy companies, confirmed that segments for the pipeline are stored at the port but declined to comment on whether the Akademik Cherskiy's arrival meant that a restart of construction was imminent. The threat of U.S. sanctions is "unlawful discrimination against European companies," Nord Stream 2 said Wednesday in an emailed statement in reply to questions.
Despite the sanctions, Gazprom Chief Executive Officer Alexey Miller has said Russia has the means to build the remaining section on its own, without specifying how. Exports via the link may start by the end of the year, he said.
Ongoing activity at the Mukran Port in the midst of coronavirus pandemic lockdowns underscores the strategic importance of the project. The facility, located on the island of Ruegen, some 300 kilometers (326 miles) north of Berlin, is a key Nord Stream 2 logistics center that began receiving pipeline segments in 2016.
Satellite images captured by Planet Labs inc. on May 10 show that sections of pipeline have been moved to a jetty equipped with a crane for loading. Ship-tracking data shows that a dredging vessel operated by a Nord Stream 2 contractor, as well as a Russian pipe-laying-crane ship are also in the vicinity and that the Akademik Cherskiy had moved as of Wednesday next to the jetty loaded with pipes.
U.S. lawmakers drafted legislation signed by Trump in December that forced a pipe-laying ship operated by Allseas Group SA to retreat from the project. Washington argues Nord Stream 2 would give Russia new leverage over Europe. In June, Trump suggested trans-Atlantic allies should buy American liquid natural gas instead.
BloombergNEF estimates only about 6% of the NS2 pipeline is unfinished and that the Akademik Cherskiy could complete construction so that the pipeline ships gas by the end of 2020.
German authorities have stood behind the Nord Stream 2 project, even as regulators consider forcing the venture to change its ownership structure. The almost 10 billion-euro ($11 billion) project is being financed by Royal Dutch Shell Plc, Germany's Uniper SE and Wintershall AG, as well as France's Engie SA and Austria’s OMV AG.
As UNIAN reported in early March, Ukraine's energy giant Naftogaz CEO Andriy Kobolyev has said Ukraine was in talks with the United States and other partners on how to finally "bury" Russia's Nord Stream 2 gas pipeline if sanctions fail to bring its construction to a halt as Kyiv is wary of ultimately losing the status of a gas transit country and the corresponding profits once NS2 has been completed.
UNIAN memo. The Nord Stream 2 project envisages construction and operation of two gas pipeline branches with a total throughput capacity of 55 billion cubic meters of natural gas per year from the coast of Russia through the Baltic Sea to Germany. It should connect Russia's Ust-Lug and Germany's Greifswald.
This new pipeline bypassing Ukraine is to be built next to the existing Nord Stream 1 pipeline. The construction of the pipeline was expected to be completed before the end of 2019. The pipeline will be 1,220 km long.
Ukraine will potentially lose US$3 billion in annual revenues if the new pipe is completed. Besides the U.S. and Ukraine, the project is also highly criticized by Poland and the Baltic States.
On December 20, U.S. President Donald Trump enacted the U.S. defense budget for 2020, which provides, inter alia, sanctions against companies involved in the construction of the Nord Stream 2 and TurkStream pipelines. After that, the Swiss company Allseas suspended participation in the construction of Nord Stream 2.
On December 30, it became known that the company had withdrawn from participation in the project, its ships had already left the Baltic Sea.
On January 11, 2020, Russian President Vladimir Putin said Russia could complete the construction of Nord Stream 2 independently, and the pipeline would start operating, most likely, in the first quarter of 2021.