Germany Ready to Pay Twice as Much for US Gas to Avoid Dependence on Russia

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Construction of Nord Stream pipeline - Sputnik International
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About five million German households are under threat, as the Netherlands is planning to suspend its gas supplies to Germany. Germany wants to solve the problem by importing the liquefied natural gas (LNG) from the US, although it would be much simpler and cheaper to connect with the Russian Nord Stream, Sputnik Germany reported.

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Germany has been receiving one third of its gas from the Netherlands, but Dutch reserves are gradually running out.

After the 2012 earthquakes that occurred as result of gas extraction, causing severe protests among the population, the Dutch government decided to cease gas exports by 2030.

The suspension of supplies from the Netherlands will affect about five million households in the west and north of Germany, mainly in the state of North Rhine-Westphalia.

Thyssengas, which provides gas supplies in the region, previously viewed Gazprom as a new source of supplies. To connect with the Russian Nord Stream pipeline, it was planning to build a 100-kilometer leg — a Baltic Link pipeline — of a total cost of 300 million euros.

However, after the French energy company Électricité de France (EDF) and the Dutch fund DIF became owners of Thyssengas in 2016, the company has changed its position.

Now, Thyssengas is considering importing gas from the US and the Persian Gulf countries: the gas is expected to be supplied from the Belgian Zebrugge port via the Netherlands to Germany. To implement this plan, the company will have to build a 220-kilometers-long leg — known as Zeelink pipeline — which will cost about 600 million euros. The project is thus twice as long and expensive as the previous plan involving Nord Stream.

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The decision could have been triggered by the position of a number of European countries, repeatedly voicing concerns over Europe's energy dependence on Russia and demanding diversification of energy supplies. Despite the protests of ecologists and local residents, the gas pipeline is scheduled to be launched in 2021.

In addition to supplies from the Netherlands, Germany is currently receiving gas via the North Sea from Norway and via the Baltic Sea from Russia. With the construction of the Zeelink pipeline, it will start buying gas from the US, the Gulf countries and even North Africa.
However, as Sputnik Germany reported, the decision could have been largely influenced by lobbying and politics, rather than practical considerations.

"As Germany's demand for gas is growing, the West can't avoid expanding trade with Russia, which has the world's largest gas reserves. It is highly unlikely that in the long term, conditioned and costly supplies of LNG from the US will be sufficient and justifiable," the media outlet wrote.

According to Sputnik Germany, Germany could build both Baltic Link and Zeelink, to ensure optimal gas supplies. Moreover, it could turn Thyssengas and North Rhine-Westphalia into a major gas hub.

"However, the expansion of the gas supply network requires a complex decision-making process: all 14 gas transport companies in Germany must approve it. While Zeelink seems to have easily overcome this obstacle, there was resistance when it came to building a pipeline connecting with Nord Stream-2," the article said.

"This fits into the general political discussion about the Nord Stream-2 and dependence on Russia as an energy supplier," it noted.

The Nord Stream 2 pipeline was envisioned to transport natural gas from Russia to Germany across the Baltic Sea alongside the original Nord Stream while bypassing Ukraine, aiming to enhance the security of supplies and strengthen the internal energy market.

However, a number of European countries have voiced concerns over the infrastructure project, arguing that it would increase Europe's energy dependence on Russia. The launch of the Nord Stream 2 gas pipeline is planned for 2018.

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