Blow to Nord Stream 2: EU Pipeline Rules Tightened Less After French-German Compromise

Written by | Monday, February 11th, 2019

Rules on the contentious Nord Stream 2 gas pipeline from Russia to Germany were toughened somewhat by bloc ambassadors on Friday (8 February) while also pulling back from changes that could have undermined the whole project. France announced earlier that it changed its position regarding Russia’s Nord Stream 2 pipeline and would support an EU proposal to regulate the controversial project, potentially threatening its completion and complicating things for Germany, which is an avid supporter of the pipeline. France and Germany have, however, hammered out a compromise in the end, thus extending EU oversight of the Russian-funded $9.5bn Baltic subsea project, including rules on transparency and shared usage.


The European Commission sought to extend its energy market regulations to offshore gas pipelines before the construction is finalized. In this way, the EU executive will have more say over how Nord Stream would be used. The pipeline that is fully owned by Russian state energy company Gazprom will bring gas to Germany from Russia through a link under the Baltic Sea. Diplomatic sources say that Germany had been putting pressure on other EU countries to block the new regulation.


“France intends to support the adoption of such a directive. Work is continuing with our partners, in particular with Germany, on possible changes to the text,” French foreign ministry spokeswoman Agnes von der Muhll commented. However, any potential delay to the development of the project would make its investors – Gazprom partners, namely Germany’s Uniper and BASF’s Wintershall unit, Anglo-Dutch Shell, Austria’s OMV and France’s Engie – nervous.


The EU member states are divided over the project. Eastern European, Nordic and Baltic Sea countries see the project as a potential threat that will make Europe hostage to Moscow while the northern EU states, led by Germany, would like to see the pipeline come to fruition, prioritizing the economic benefits over geopolitical implications. The changes to the directive imply a change in the wording of the text – the pipeline is newly called an “interconnector” by including pipelines linking the EU to third countries such as Russia.


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