Russia forges ahead with gas pipeline despite EU and US opposition

As US and European Union politicians stepped up efforts to derail Russia’s Nord Stream 2 gas export project this week Pioneering Spirit, the world’s largest construction vessel, sailed into the Baltic Sea to begin laying deep water sections of the highly controversial pipeline.

Kremlin-controlled Gazprom is forging ahead with construction of the 1,200km pipeline, which will enable Russia to double the amount of gas it transports to Germany across the Baltic and minimise use of its traditional transit route through Ukraine.

Gazprom says Nord Stream 2 – which will lie parallel to the already operating Nord Stream 1 – is needed to compensate for falling production at European gas fields and that it can supply gas more cheaply than its international competitors. Opponents of the project say it will make the EU overly reliant on Russian gas and deprive Ukraine of badly needed gas transit revenues.

US and EU officials have ramped up criticism of Nord Stream 2 since Russia arrested three Ukrainian ships and their crews in the Kerch Strait near Crimea last month. Fears are that once Gazprom is free of dependence on Ukraine to access its main export market, the Kremlin will be even less likely to seek compromises with its neighbour.

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In a resolution adopted on Wednesday, the European Parliament called for the termination of Nord Stream 2, saying the project was political and posed a threat to European energy security.

The move came a day after the US House of Representatives condemned Nord Stream 2 as a “drastic step backwards for European energy security and United States interests”.

Russian officials hit back, accusing the US of putting pressure on the EU to ditch Nord Stream 2 and create a gap in the market that American liquefied natural gas exporters could fill. The US was “using all permissible and not permissible methods” to block the pipeline, and this was “nothing more than camouflaged, dishonest competition”, said Kremlin spokesman Dmitry Peskov.

Russian foreign ministry spokeswoman Maria Zakharova hit out at MEPs, saying it was “madness” to reject co-operation with Russia at a time when the continent needed additional energy supplies. “They must be pinning their hopes on global warming or firewood to reduce their need for natural gas imports,” she told reporters in Moscow on Thursday. “The place where firewood can be obtained is well known,” she added. in a reference to Russia’s vast timber resources.

Gazprom appears to be betting that it’s too late to stop Nord Stream 2 from going ahead. Some 300km of the pipeline had already been laid in shallow waters near the German coast, the company said last month. Completion of other sections in the coming months would allow the system to become operational by the end of 2019.

However, opponents of Nord Stream 2 still have room for manoeuvre. In the US President Donald Trump’s administration is considering imposing sanctions on European companies helping finance and build the pipeline. The EU may consider applying anti-trust laws to oblige Gazprom to share access to Nord Stream 2 with competing gas suppliers.