Why in News?
Recently, the Nord Stream 2 Pipeline Project was in news due to the US warnings to stop the pipeline if Russia attacks Ukraine, but the European countries led by Germany, seemed unwilling initially to impose sanctions on the Nord Stream due to its significance though US has announced sanctions on Russia’s Nord Stream 2 pipeline company after it recognized two breakaway regions in eastern Ukraine.
- Nord Stream is the longest subsea pipeline and is an export gas pipeline which runs under the Baltic Sea carrying gas from Russia to Europe.
What is it?
- Nord Stream contains two pipelines, which have two lines each.
- Nord Stream 1- It runs from Vyborg in Leningrad (Russia) to Lubmin near Greifswald, (Germany) and was finished in 2011.
- Nord Stream 2- It runs from Ust-Luga in Leningrad to Lubmin was completed in September 2021 with the capacity to handle 55 billion cubic meters of gas per year once it becomes operational. This pipeline falls in the territories of EU members, Germany and Denmark and is about 98% complete.
- The twin pipelines together can transport combined total about 110 billion cubic metres (bcm) of gas per year to Europe for nearly 50 years.
- The Nord Stream crosses the Exclusive Economic Zones (EEZ) of many countries namely Russia, Sweden, Finland, Denmark and Germany, and the territorial waters of Russia, Germany and Denmark. The pipeline connects to the OPAL (Baltic Sea Pipeline) and NEL (North European Pipeline) in Germany, which then connects to the European grid.
Objections to the Pipeline-
- According to some environmentalists, the project does not fit in with German efforts, to cut dependence on fossil fuels and fight climate change.
- Nord Stream 2 has not yet begins operating because Germany says it does not comply with German law so Germany has suspended its approval. The project is awaiting approval from the European Commission.
- The strategic objection of the project particularly from the U, is that it will make Europe unduly dependent on Russia that will result into increasing Russian influence in Europe. Furthermore, there is concern that it could be used as a geopolitical weapon by Russia.
- Once the pipeline becomes operational, Ukraine will lose around USD 2 billion in transit fees, so it has objected this project.
- Other countries like Belarus and Poland may also lose transit fees, therefore oppose the pipeline as it will bypass existing pipelines running through them.
Significance of Nord Stream 2-
- Every year more than 100 billion cubic metres (bcm) of natural gas is the need of Europe and nearly 40% of its gas comes from Russia.
- In last few years, Europe has become more reliant on gas imports due to decrease in domestic gas production. So reducing dependence on Russian gas is difficult as there are no easy replacements.
- Germany is more dependent on other countries for the import of Gas and Oil. This pipeline will help stabilize the situation as Germany is biased towards a stable manufacturing economy and planning to gradually move towards renewable sources of energy. As Russia, which has the largest natural gas reserves in the world and around 40% of its budget comes from trade of gas and oil. Russia will get direct access to the European market.
- Nord Stream 2 is crucial because it remove the risks related to sending gas through transit countries, it cuts operating costs by doing away with transit fees and provides direct access of European market to Russia.