EU Parliament's Nord Stream 2 Resolution Political Move, Nobody To Gain From Cancellation

OSCOW, December 14 (Sputnik), Valentina Shvartsman - The European Parliament's recent resolution calling for scrapping the construction of the Nord Stream 2 pipeline is politically motivated, as a cancellation of the project would hardly benefit anyone, including the EU member states, experts told Sputnik.

MOSCOW (UrduPoint News / Sputnik - 14th December, 2018) OSCOW, December 14 (Sputnik), Valentina Shvartsman - The European Parliament's recent resolution calling for scrapping the construction of the Nord Stream 2 pipeline is politically motivated, as a cancellation of the project would hardly benefit anyone, including the EU member states, experts told Sputnik.

On Wednesday, the European Parliament adopted a non-binding resolution calling for canceling the Nord Stream 2 project. The document, while praising Ukraine for its achievements in the areas of energy efficiency, stressed that the Nord Stream 2 pipeline was a "political project that poses a threat to European energy security."

The Russian Foreign Ministry has said the resolution was politically motivated and adopted under US pressure. Moscow added the document had nothing to do with energy.

Ralf Dickel, a senior visiting research fellow at the Oxford Institute of Energy Studies, noted in this comments to Sputnik that the resolution's remarks about the project being "a threat to European energy security" were untrue.

"This, of course, contradicts to simple logic. I mean, if you have more pipelines to buy Russian gas, that cannot diminish energy security. Outside of existing long-term contracts, nobody is forced to buy Russian gas. If you are not forced to buy Russian gas, then whether you buy it via Nord Stream or via Ukraine - [it] would not change [things] much. It is an argument which is contradicting simple logic," Dickel said.

The expert went on suggesting that the document was reflecting political disagreements, which were not linked to the project itself.

"The European Union has a lot of countries that have political difficulties for historic reasons and other conflicts and which try to project these conflicts on Nord Stream 2, and this is at times reflected with such resolutions," Dickel noted.

His words were echoed by Tiberio Graziani, chairman of Vision & Global Trends, International Institute for Global Analyses, who told Sputnik that the move was motivated by "ideological prejudice" that prevailed over economic rationality.

"In the absence of geopolitical reflection, the MEPs made the wrong choice. Evidently the ideological prejudice, associated with the political myopia and the atlanticist strabismus, that is a sort of 'atlanticist extremism,' prevailed over the reasons, eminently economic, that underlie the pipeline project," Graziani said.

Both German and Finnish governments announced that their positions on the project remained unchanged in the wake of the adoption of the European Parliament's resolution.

A representative of the German Cabinet's press service told Sputnik that Berlin considered the Nord Stream 2 pipeline, first and foremost, an economic project, noting, however, that it was necessary to clarify what will happen to Ukraine's role as a transit country after 2019, when the news gas pipeline is expected to be put into operation.

Kari Klemm, the government counsellor at the Finnish Ministry of Economic Affairs and Employment, told Sputnik that Helsinki's decision to authorize the Nord Stream 2 pipeline construction project was based on the Finnish law on the country's exclusive economic zone and the UN Convention on the Law of the Sea (UNCLOS), which stipulated the right of every state to lay pipelines and cables in its exclusive economic zone. At the same time, Helsinki's decision on the project took into consideration, among other things, the market-driven approach in the energy area, Klemm noted.

Andrej Hunko, a member of the German Bundestag for The Left (Die Linke) party, told Sputnik that Berlin was likely to follow through with the implementation of the project.

"The majority of the German parliament, the German government is seeing Nord Stream 2 as economic project of economic companies, and they do not want to interfere in the project, and especially the Social Democrats and the government [think that] we should keep on Nord Stream 2. But it is the whole position of Germany, we all are supporting this. I do not think that Germany would cancel now the project," Hunko said.

Dickel also pointed out that the project was unlikely to be called off at this stage, especially given that there had been some good progress on the technical aspect.

"I do not see a cancellation of this project. That is project which is going on and makes good progress ... I believe that Nord Stream will go on, and there is a good chance that it will be ready in time," the expert noted.

As of November 21, Nord Stream 2 AG, a Swiss-based firm behind the construction of Gazprom's gas pipeline across the Baltic Sea, has laid about 250 kilometers (155 miles) of pipes, according to the company's spokesman.

Some 20 pipe-laying vessels are working simultaneously to ensure its timely completion.

Though unlikely, the theoretical cancellation of the project would hardly benefit anyone, according to experts. Graziani stressed that the attempts to call off the project were an "economic and financial suicide" for the European Union.

"The resolution voted by the European Parliament to stop the pipeline called Nord Stream 2 could constitute, in the near future, a real economic and financial suicide for the member countries of the European Union," Graziani said.

In particular, such a move may hurt the Russia-German cooperation and businesses involved in the pipeline project.

"Affected most will be still existing cooperation between Germany and Russia, Central Europe and Russia ... Nord Stream 2 is mainly between Germany and Russia, so Germany and Russia would be affected most, and the companies that invested in this project," Hunko said.

According to experts, cancellation of the pipeline construction may benefit Washington, which is seeking to promote its liquefied natural gas in the European Union and has repeatedly expressed its opposition to Russian gas deliveries, particularly to the Nord Stream 2 project, claiming that it was the means of political control used by Russia to exert pressure on the European Union.

In particular, the US House of Representatives passed a resolution on Tuesday opposing the Nord Stream 2, claiming that the pipeline allegedly was a "drastic step backwards for European energy security and United States interests."

"In theory, the cancellation of the Nord Stream 2 project should favor US programs to export their liquefied natural gas to Europe," Graziani said.

Hunko underlined that the United States was seeking to gain a larger share in the EU energy market.

"There is heavy interest of US fracking gas, they want to bring it to Europe through LNG ... Now there several terminals here in Europe for this gas, and they want to get control, maybe a bit more, in energy politics in the European Union," he said.

The lawmaker noted that the US supplies of LNG were not economically competitive, because Russian gas was cheaper and not as much damaging to the environment as fracking used by the United States to extract shale gas.

"So I think that they are trying to bring it [LNG] in through political measures," Hunko said.

Dickel pointed out that theoretical cancellation of the project would also lead to growing demand for energy and, accordingly, higher prices, which would benefit other energy-producing countries, including the United States.

"There would be more demand for energy that might benefit the United States in terms that the United States does not export large volumes of energy to Europe or to the European Union. Most of it goes to other areas - China, India, Pakistan, South America. But, nevertheless, it would increase demand for energy worldwide and lead to certain increase in price of energy, which would be to the benefit of energy-exporting countries and for the United States that would also be of some political importance," Dickel said.

The expert explained that the scrapping of the pipeline constriction would be a lose-lose situation for Europe, Ukraine and Russia.

"The EU will have less secure supplies or less option for supplies from Russia, and would have to return to more expensive energy. Russia would also surely have difficulties to fulfill the contract and to make use of smacked opportunities. And I really doubt that this will benefit Ukraine, will be best for Ukraine ... So I do not see anybody benefiting from that, except for, maybe, the United States," Dickel said.

Nord Stream 2 is a joint venture of Russia's Gazprom with France's Engie, Austria's OMV AG, UK-Dutch Royal Dutch Shell, and Germany's Uniper and Wintershall. It aims to deliver 55 billion cubic meters (some 2 trillion cubic feet) of Russian natural gas a year to the European Union through the Baltic Sea bypassing Ukraine.

The pipeline project has been welcomed by some countries in Europe and opposed by a number of others, particularly Latvia, Lithuania and Poland, have opposed the project. German Chancellor Angela Merkel has repeatedly stated that Berlin sees the Nord Stream 2 project as commercial, but at the same time linked its implementation to continuation of transit of Russian gas through Ukraine. The Russian side has also repeatedly stated that the Nord Stream 2 project was completely commercial and competitive, and indicated that it does not imply the termination of the transit of Russian gas through Ukraine to the European Union.