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From Russia with Love: The Nord Stream II Pipeline

Launch ceremony for the first Nord Stream pipeline in 2011. Source: http://en.kremlin.ru/
Launch ceremony for the first Nord Stream pipeline in 2011. Source: http://en.kremlin.ru/

While different issues within the European Union may come and go, one always remains: energy supply. Being the energy junkie that it is, the recent Russian-led gas pipeline project, Nord Stream 2, has put EU energy supply under question once more. The idea of increasing the already overwhelming energy dependency on Russian gas has sparked widespread debate over the future of EU energy security. But what exactly is the Nord Stream 2 pipeline, and what are the controversies with the project? This article will shed  light on the EU energy situation in general and the implications of building a new Russian gas pipeline.  

Energy is one of the European Union’s most vital imports. In fact, more than half of the energy supply to EU member states comes from countries outside the EU. Furthermore, the sources from which energy is imported remain extremely narrow.  In 2014, 69.1% of EU natural gas imports came from only two suppliers: Russia and Norway. Many European countries, most notably central and eastern states, rely on a single supplier of oil and gas.  This leaves them highly vulnerable to external disruptions to supply, including political and commercial disputes as well as infrastructure failures. The European Commission released the Energy Security Strategy in response to these concerns in 2014, which outlines measures to ensure a stable and sufficient supply of energy for European citizens and the EU economy. Diversifying energy sources has been a focal point of the strategy – yet with the plan of constructing a new Russian gas pipeline, it seems the strategy may in fact be taking a few steps back instead of forward.

The first Nord Stream pipeline was completed in 2012. It was a project which was backed by the EU following a gas crisis in 2009. A payment dispute between Ukraine and Russia caused the Russian-controlled company Gazprom to cut off all the gas supply to Europe through Ukraine, Europe’s main supply route. As Europe was desperate for a new route in case of another shutdown, the Nord Stream was built.

Nord Stream route from Russia to Germany. Source: Samuel Bailey, Wikimedia Commons.
Nord Stream route from Russia to Germany. Source: Samuel Bailey, Wikimedia Commons.

However, only a few years later, Gazprom proposed the construction of another pipeline to be built parallel to the original one in hopes of increasing gas supply further through this route. This project, Nord Stream 2, is a 10 billion EUR venture between Gazprom and five European gas companies. The plan proposes an approximately 1,200 km dual pipeline from Russia to Germany through the Baltic Sea, next to the already existing Nord Stream 1. It is intended to transport 55 billion cubic meters of gas a year, doubling Russia’s existing gas export to Europe.

Since its introduction, the Nord Stream 2 pipeline has been a highly debated project across Europe for several reasons. While the actual necessity and economic gain of a second pipeline through the Baltic Sea has been questioned from the beginning, geopolitical issues have now taken a front seat. First and foremost, the debate has focused on the dependency on only a few external energy suppliers, most notably Russia. As mentioned, the EU is highly dependent on external energy supply due to its lack of internal energy sources within the union. Ensuring continuing energy supply is thus essential, which is why EU focus has been on diversifying energy sources, routes, and providers. Russia is the main supplier of crude oil and natural gas to the EU today, and the leading controversy regarding the new pipeline is the increased dependency on Russian energy.

Another concern is that it would be built next to the old one, which undermines the plan of diversifying energy routes into Europe, a key point of the EU Energy Security Strategy. As the aim of the Energy Security Strategy was to diversify energy suppliers and import routes, and thus lessen the reliance on Russia, it can be argued that with Nord Stream 2 a complete opposite direction would be taken.

Moreover, an extensively discussed controversy with the pipeline is the outcome it could have on Eastern/Baltic EU states. With the recent sanctions on Russia over Crimea in 2014, this raises the question of how much more power over European affairs does the EU want to give Russia, given its already vulnerable position in energy security?

“Crimea is Ukraine” protest in Kiev over Russian annexation of Crimea in 2014. Source: ВО Свобода, Wikimedia Commons.
“Crimea is Ukraine” protest in Kiev over Russian annexation of Crimea in 2014. Source: ВО Свобода, Wikimedia Commons.

Due to Russia’s recent issues with Ukraine, there have been claims of the new pipeline project merely being a way for Russia to further bypass Ukraine, through which pipelines into the EU currently go. There are growing concerns in Ukraine over the effects of an additional Nord Stream pipeline – if more of the transport is moved up north, the role of Ukraine as a transit country may cease to exist altogether. Giving Russia more direct power over energy supply to the EU may further impede energy competition in the eastern European gas market.

When launched, the EU Energy Security Strategy stressed the need to diversify energy sources, suppliers and routes in order to guarantee secure energy supplies. In reality, it seems that the Nord Stream 2 pipeline would, in fact, do the opposite. More Russian dominance in the EU energy market does not ensure competition nor diversification. Furthermore, if this plan goes through, 80% of Russian gas imports would be reliant on a single supply route, which is exactly what the energy strategy wanted to avoid.

The future of the pipeline is yet to be decided. What is obvious at this point, however, is that the Nord Stream 2 pipeline will not provide the EU with a new source/route of supply nor a new supplier, which had been intended to be its top priority regarding energy security. While proponents of the pipeline argue for its construction from a commercial perspective, it is still regarded by many as a risky geopolitical energy move.

Laura Lindström

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