Danish Authorities Refuse to Construct Nord Stream 2 Gas Pipeline

by Alicja Szczepkowska

Prezes ukraińskiej firmy energetycznej Naftogaz, Andrij Kobołjew ogłosił na mediach społecznościowych odmowę rządu Duńskiego w sprawie budowy gazociągu na ich wodach terytorialnych. Dodatkowo administracja Trumpa zagroziła usankcjonowaniem firm europejskich inwestujących w rurociąg. Nałożenie sankcji związanych z finansowaniem Nord Stream 2 z pewnością zwiększy napięcia między USA, Niemcami i Kremlem. Ukończenie do końca roku  2019 przedsięwzięcia Nord Stream 2 wydaje się być mało prawdopodobne.

 

Will Denmark’s refusal to construct Nord Stream 2 gas pipeline hinder its construction?

While a number of EU countries have expressed their disapproval of the Nord Stream 2 project, including Poland and Lithuania, the construction of the Nord Stream 2 Gas Pipeline remains underway and is estimated to be completed by the end of 2019. Gazprom, the Russian Gas Company that is the sole shareholder financing the ten billion dollar project, also financed the construction of Nord Stream 1 back in 2011-2012. Gazprom and its European partners–Germany’s Uniper and Wintershall, Anglo-Dutch group Royal Dutch Shell, France’s Engie, and Austria’s OMV–began the process of constructing Nord Stream 2 in May of 2018. The pipeline will be laid out in the Baltic Sea, connecting Germany and Russia while bypassing Ukraine, Poland, and Baltic countries. The layout of the pipeline may be strategic, however, it has raised several concerns among Danish authorities.

Finland, Sweden, Germany and Russia have approved the project making Denmark the last country that needed to approve the construction permit for Nord Stream 2. Danish authorities made the decision to refuse to construct the gas pipeline within their waters. CEO Andriy Kobolyev of Naftogaz, a Ukrainian energy company, announced this on Facebook and Twitter platforms. The Danish Energy Agency has asked Gazprom to look into a southern route instead. This refusal poses yet another problem that Gazprom will have to overcome in its construction process.

Polish President Andrzej Duda has advised the German government to abandon the Nord Stream 2 project insisting the new pipeline would breach the current energy balance, posing a danger to the energy security of several countries in Central and Eastern Europe. Similarly, the Trump Administration also expressed very strong opposition to building the pipeline, which would double Germany’s Russian gas imports. U.S. Secretary of State Mike Pompeo went as far as calling Nord Stream 2 “Russia’s political weapon.”

President Trump strongly criticized Germany for supporting the project and correctly observed that this will give Russia more political influence on Germany. This will intimidate other European nations, because the entire continent will be dependent on Russian natural gas. Furthermore, according to Forbes, “the Trump administration has threatened to sanction European companies investing in the pipeline.” Imposing these sanctions against companies linked with Nord Stream 2 financing will certainly increase tensions between the U.S., Germany, and the Kremlin. Gazprom and its corporate “collaborators”, could face sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA)” according to Fortune. In addition, Handelsblatt Today points out that “Sources in the German government believe that, if extraterritorial sanctions did happen, the US would first target smaller, specialized firms involved in Nord Stream 2’s construction.”

There is no doubt that obstacles continue to hinder the construction of Nord Stream 2. On one side, Danish authorities are refusing to construct the gas pipeline within their waters while on the other, the Trump administration is sanctioning European companies. It is unlikely that Nord Stream 2 will be completed on time by the end of 2019 as it had been planned.

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AlicjaSzczepkowska

Alicja Szczepkowska is an intern at the Polish American Congress and an undergraduate student at the University of Illinois in Urbana Champaign majoring in Global Studies and Sociology.

 

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