The Nord Stream: Dependable partner for Europe

The Nord Stream gas pipeline has become a reality with the first section of the pipeline entering into service on September 6th. At the outset the pipeline will be pumping process gas, as opposed to the real product, in order to verify system integrity before going on-line, with the first gas to reach Germany by November.

The Nord Stream gas pipeline has become a reality with the first section of the pipeline entering into service on September 6th . At the outset the pipeline will be pumping process gas, as opposed to the real product, in order to verify system integrity before going on-line, with the first gas to reach Germany by November. The second section of the pipeline will be commissioned in 2012. Russia is ready to lay a third, and a fourth section, if needed.

The Nord Stream, which bypasses Ukraine, is a fundamentally new route to deliver Russian gas to Europe. The 1220-kilometer pipeline runs along the bed of the Baltic Sea, entering the waters near Portovaya Bay and makes landfall near the German town of Greifswald. 

In September, when Russian Prime Minister Putin opened the valves that started the gas pumping into the Nord Stream gas pipeline, it was confirmed, for those who had doubts, that Russian-German energy cooperation had entered a new era.

Prime Minister Vladimir Putin said the following at the opening of the Nord Stream pipeline; “Transit countries are often tempted to use their exclusive status to their own advantage. Now that they no longer have this status, our relations with them will become more and more civilized.” His words were addressed to Ukraine first and foremost due to Russian gas recently having to go through Ukraine to reach Europe. Kiev’s actions often obstructed gas supplies to EU countries.

Experts expect Nord Stream to considerably reduce transit risks, thereby guaranteeing uninterrupted gas supplies to Europe. A Voice of Russia correspondent met with Alexander Pasechnik of the National Energy Security Foundation. He said the that the Nord Stream would enable Russia to minimize the risks by pumping gas to Europe bypassing Ukraine, and partly bypassing Belarus. The new pipeline would reduce transit dependence on Ukraine twofold he said. 

The Managing Director of Nord Stream AG, Matthias Warnig, says that the pipeline will satisfy one fourth of the European demand for gas. The capacity of the first line is 27.5 billion cubic meters a year. The second line will be completed in 2012 with 600 kilometers of it having already been built. The commissioning of the second line will boost yearly gas supplies to Europe to 55 billion cubic meters but is unlikely to meet the EU’s demands in full.

Most European businessmen are fully aware of the value of the project. Along with Russia’s Gazprom, Nord Stream partners include the German E.ON Ruhrgas, BASF. Wintershall, and the French Gaz de France Suez. Buyers too are laying their hopes on Nord Stream. Gazprom has signed long-term contracts with consumers in Germany, Denmark, the Netherlands, Belgium, France and Britain. 

The construction of Nord Stream’s second leg is due to be wrapped up before the end of 2012, something that will increase the pipeline’s annual capacity to 55 billion cubic meters of gas which will be a sufficient amount to meet the gas demands of 26 million households in Germany, France, the Netherlands, Britain, Denmark and other EU countries.

Even though Europe keeps talking about “excessive energy dependence” on Russia, gas supplies from Russia offer the best solution to European gas shortages. Alternative projects, such as Nabucco either do not have enough gas, or are at the initial stages of development. In contrast, Nord Stream is a reality with a guaranteed abundance of gas from gas-rich Russian deposits. Moreover, the Baltic pipeline ensures Europe’s energy security by ridding the seller and the buyer of their dependence on transit countries.