Nord Stream 2 could be 'act of war'

Russian plans to build a huge gas pipeline that bypasses Ukraine could be seen as an act of war, a Brussels conference was told.

By Martin Banks

Martin Banks is a senior reporter at the Parliament Magazine

19 May 2016

EU energy expert Alan Riley, of the Atlantic Council, said there were political and economic dimensions to the proposal by the Russian state-owned gas company Gazprom to double the capacity of the Nord Stream pipeline by 2019.

But Riley, a British lawyer, said the ongoing war in Ukraine, where Russian-backed separatists are engaged in a bitter conflict with the Ukrainian military, cannot be overlooked.

He said, "You cannot forget that Ukraine has been invaded by Russia and that Ukraine stands to lose up to €1.8m in revenues if Nord Stream goes ahead. That is why some could see this project as a war aim by Russia."


Riley also questioned the legality of the ambitious scheme, saying, "It is very difficult to see how you can make Nord Stream 2 work with current EU energy rules. It makes you wonder how its commercial partners ever thought they could."

One of the problems, he said, was that about 100 miles of the pipeline will be under the sea, which is thought to be out of the legal jurisdiction of the EU.

Riley believes there is an alternative to Nord Stream 2, suggesting that, with predictions of a looming surplus in gas supplies, Europe could expand its own gas supplies.

He warns that, if allowed to go ahead, the project will result in "endless political and legal arguments."

Speaking at the same event, Maroš Šefčovič, European Commission Vice-President for energy union, said the EU authorities were currently studying the legal aspects of the project.

He said, "Currently, Nord Stream does not appear to be in line with the core principles of the energy union or EU energy legislation."

It said it was a "matter of concern" that, if Nord Stream goes ahead, some 80 per cent of Russian gas will go via a single route, bypassing Ukraine.

"Some argue that it is merely a commercial project and that it should be allowed to proceed but there is a counter argument and that is why we are currently analysing all the legal aspects."

Further comment came from Szymon Kardas, a senior research fellow at the Warsaw-based Centre for Eastern Studies (OSW), who said the project offered Russia "obvious economic benefits."

He added, "The problem with Nord Stream is that it hinders diversification of energy supplies, a key EU energy policy, and undermines increasing energy cooperation between member states."

"Nord Stream is unnecessary and if it is allowed to go ahead, there will be serious consequences for all EU member states."

Kardas, an expert on Russian energy policy, argues against Nord Stream, as he believes it will increase Europe's dependency on Russian energy supplies.

Nord Stream also involves a consortium of European companies including E.ON, BASF/Wintershall, OMV, Shell and Engie. If built, the new pipeline would increase the transport of gas from Russia to Germany via the Baltic Sea, bypass a number of central-eastern European countries and possibly divert flows away from Ukraine. 

Supporters of the project claim that it is a commercial deal that would increase security of supply. 

Opponents argue that the project conflicts with the EU's commitment to promote energy security and diversify its gas routes and sources, key priorities under the energy union strategy. 

It is also argued that the project is at odds with the EU's commitments under international law and would send a contradictory political message about the Union's support for Ukraine at a time when Russian aggression is contributing to destabilising Europe.

The policy dialogue on Wednesday was organised by the Brussels based think tank, European Policy Centre.

Speakers discussed the political, energy security, economic and legal concerns related to the expansion of the Nord Stream pipeline, the project's alignment with the projected energy trends and EU's climate and energy objectives.


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