The German energy regulator has not granted an exemption to the operator of the Russian Nord Stream 2 pipeline from the European Union’s gas directives. This is a new setback for the project to transport Russian gas via pipelines through the Baltic Sea to Germany and other Western European clients.
The construction of Nord Stream 2, designed by Russian Gazprom, is significantly behind schedule and faces political opposition from Washington as well as from Russia’s neighboring countries Ukraine and Poland. Except for a few hundred kilometers, the pipeline has already been built, but the last section cannot be completed by Western European companies due to various legal boycott rules. This must now be finished by a Russian pipe-layer.
The German regulatory authority for pipelines, the Bundesnetzagentur, stated that the project was not exempt from EU unbundling rules which require separate subsidiaries in the EU territory for production, transport, and distribution of energy. The regulator said that the Nord Stream 2 consortium – which also includes Uniper, Wintershall-Dea, Royal Dutch Shell, OMV, and Engie – did not qualify for exemption because the construction was not completed before May 23, 2019.
That had been the plan earlier, but due to looming US sanctions against European pipe-layers, the Russian project suffered major delays. The legal dispute over the regulations is not expected to have a large impact on the pipeline’s construction but could cause further delays. Nord Stream 2 is expected to be commissioned in early 2021.
Additionally, Germany’s relations with Moscow are currently under pressure after Chancellor Angela Merkel said this week that "hard evidence" was found that Russian agents were behind a 2015 hacking attack on the parliament.
Merkel said that the attack, in which the email accounts of members of the Bundestag, including her own, were plundered, was part of Russian attacks aimed at disorienting opponents. Russia denied any involvement.