Iran Energy News Oil, Gas, Petrochemical and Energy Field Specialized Channel
Related Articles
Russia`s Nord Stream 2 natural gas pipeline project should stay out of politics and be protected from potential attacks. Kremlin spokesman Dmitry Peskov said Sunday. following a meeting between Russian and German leaders and reports of the US possibly introducing sanctions against the project in the coming weeks.
`In the whole. there is understanding that this project is commercially viable. competitive. so measures need to be taken to shield it from potential attacks. non-competitive attacks by third parties. so as to eventually complete this project.` Peskov was quoted by Prime news agency as saying in the German city of Meseberg. where Russian President Vladimir Putin met with German Chancellor Angela Merkel Saturday.
The leaders underlined that it is `wrong to politicize this project in any way.` he added.
Following the meeting. the Wall Street Journal wrote citing current and former US officials that the US has prepared a package of sanctions that could be used to stop the completion of Nord Stream 2 by targeting companies and financial firms involved in its construction.
US President Donald Trump has had discretionary power since last year to impose sanctions on companies investing in Russian energy export pipelines such as Nord Stream 2. potentially putting at risk five European companies — France`s Engie. Austria`s OMV. Anglo-Dutch Shell and Germany`s Uniper and Wintershall — committed to investing up to Eur950 million ($1.2 billion) each in the Eur9.5 billion project.
Russian state-owned Gazprom. the sole owner of the Switzerland-based Nord Stream 2 project developer company. plans to search for more financing later this year. but could fund the project entirely by itself if needed.
Late last month. Francis Fannon. assistant secretary at the US State Department Bureau of Energy Resources. said companies involved in Russian energy export pipelines. including Nord Stream 2. were at `significant` risk of US sanctions.
A chairman of Russia`s upper house of parliament reacted by saying the potential sanctions would not stop the project.
`Russia is ready for these sanctions. which I believe will be inevitably introduced.` Vladimir Dzhabarov. deputy chairman of the Federal Council`s foreign affairs committee. told RIA Novosti agency Sunday. `Despite that. the project will be implemented. and the US shouldn`t expect to lure anyone with its liquefied [natural] gas.`
Moscow and Gazprom have repeatedly called the US sanctions threat a noncompetitive way of promoting US LNG in Europe.
The US should not count on sanctions stopping the project implementation or encouraging its participants to leave. `no matter how much the Americans try to twist the project participants` arms.`
Nord Stream 2 is still awaiting Danish permission to cross its territorial waters. but has also filed for an alternative route earlier this month in case no such permit is granted. which would make the pipeline longer and potentially add to its costs.
`ECONOMIC` PROJECT
Earlier in the day. Putin underlined that the project is `purely economic` and serves in the EU`s best interest. allowing it to diversify supply routes and minimize transit risks while satisfying European growing energy demand.
The 55 Bcm year Nord Stream 2 route linking Russia and Germany via the Baltic Sea is designed to allow Russian gas flows to mostly bypass Ukrainian transit following after the contract between Russia`s Gazprom and Ukraine`s Naftogaz expires at the end of 2019.
The project has seen strong opposition from the European Commission as increasing EU`s dependence on Russian gas and undermining Ukrainian transit. Russia is the EU`s single largest supplier of pipeline gas accounting for about 40% of its gas imports.
Gazprom expects to hit record gas supplies to Europe and Turkey of at least 205 Bcm this year. up about 6% on the year. the company`s officials said in June.
Merkel insisted Ukraine `should play its role in gas transit to Europe even after the Nord Stream 2 launch.` as she told a briefing following her meeting with Putin. reiterating her previously voiced stance on the issue.
Putin also reiterated Russia is open to maintaining some gas flow via Ukraine but only if it is economically viable for all.
`Nord Stream 2 is a purely economic project. It does not erase the possibility of continuing transit supplies of Russian gas via Ukraine.` Putin told the briefing posted on the Kremlin website. `I would like to point out that most importantly this Ukrainian transit should correspond with economic requirements. and be economic in all meanings of the word.`
Earlier this year. Gazprom officials said the company could maintain gas transit via Ukraine in the volume of 10-15 Bcm year under a separate contract that is conditional on Ukrainian proof of economic viability and guarantees.
