Gazprom said that the Beixi 2 pipeline to Europe has now been completed


EU Energy Update

After Gazprom said it has completed the construction of this controversial project, Russia will soon be able to send more natural gas to Europe through the Beixi 2 pipeline.

This $11 billion pipeline across the Baltic Sea will allow Gazprom to bypass Ukraine and deliver 55 billion cubic meters of natural gas to Europe every year. The plan shocked Kiev that it could lose billions of dollars in gas transportation costs, while US sanctions have delayed construction.

Opponents also worry that the pipeline will make Europe more dependent on Russian gas, which already accounts for more than one-third of its demand.

Gazprom said in a statement statement “The construction of Beixi No. 2 pipeline has been fully completed.” According to industry experts, the pipeline still needs to pass technical testing and certification, which usually takes several months.

Gazprom declined to comment on the expected timetable for the first batch of natural gas circulation. Last week, CEO Alexei Miller stated that Gazprom could pipe natural gas “at the end of the year and this heating season.”

President Vladimir Putin’s spokesperson Dmitry Peskov told reporters that “everyone” has common interests and hopes to certify the pipeline “as soon as possible”. Peskov added that the Kremlin does not know when the supply will begin once the “remaining formalities” are completed.

Together with neighboring Poland, Ukraine has pledged to challenge the NS2 pipeline’s compliance with EU energy market rules, which require separation of production, transportation and supply. Such a challenge may force Gazprom to “split” the pipeline, thereby losing its control of the project.

“We hope… As we have provided the necessary arguments in Berlin and Brussels, NS2 AG should not be certified as an operator of NS2 [pipeline] Under the current circumstances,” Yuriy Vitrenko, CEO of the Ukrainian national gas company Naftogaz, told the Financial Times.

The U.S. strongly opposed NS2 but reached a consensus truce In July last year, Germany asked Berlin to impose sanctions on Russia. arms Oppose Ukraine or other allies.

Kiev stated that the agreement was in the Biden administration weightlifting Sanctions against Nord Stream 2 AG, the pipeline operator owned by Gazprom No specific guarantee Regarding the safe or future flow of Russian gas through Ukraine.

Angela Merkel, Chancellor of Germany Said When she visited Kiev after her recent visit to Moscow, Germany would not allow Russia to weaponize the gas corridor.

Mitch Jennings, an analyst at Sova Capital in Moscow, said: “Our understanding is that the United States is [National Defense Authorization Act] prohibited The certified pipeline, we think this will cause problems when publishing. “

However, this may not be a problem because Gazprom has been guiding 5.6 billion cubic meters Jennings said that by the end of this year, it will be exported through North Stream 2 because the EU is sometimes willing to let the pipeline work if negotiations are ongoing.

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Russia has recently faced criticism Send less gas Compared with previous years, continental Europe’s inventory levels are lower than normal, entering winter.

Due to tight supply in the global market, natural gas prices in the United Kingdom and Continental Europe have soared to record levels in recent weeks. Executives warned that some energy-intensive industries may even need to restrict production in the event of a very serious situation. Cold winter in the northern hemisphere.

Gazprom has stated that it has completed all the number of contracts, but the natural gas industry has heatedly debated its strategy this year, especially for its traditional customers. The company increased its exports to other countries through Turkey in 2021 and has become a larger supplier in Asia in recent years.

Additional reporting by Max Seddon in Moscow and Guy Chazan in Berlin


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