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GAS Nord Stream 2 12 September, 2018 10:00 am   

Nord Stream 2 delay by one year?

– According to the data provided by BiznesAlert.pl, the Nord Stream 2 project may be implemented with at least six months delay. If it becomes necessary to change of the route we wrote about, the gas pipeline may be created even a year later. This would weaken Gazprom’s position in talks on transmission contracts with Poland and Ukraine – writes Wojciech Jakóbik, editor-in-chief of BiznesAlert.pl.

Delay on the horizon

The delays of Nord Stream 2 have been on the horizon for a long time. The first signals appeared in May 2018, when it turned out that the investment in a new gas pipeline from Russia to Germany with a capacity of 55 billion cubic meters. Every year, it does not get building permits in the Scandinavian countries as easily as its architects would expect.

Later, the media leaked reports of a possible delay of the German branch – EUGAL, which is necessary to distribute gas from Nord Stream 2 through Central and Eastern Europe, which is the main target market for this gas pipeline, to be built by the end of 2019. We are publishing further information that Nord Stream 2 is probably delayed and the delay may be even higher.

Even a year of delay?

Mariusz Marszałkowski from the College of Europe in Natolin and a graduate of the Naval Academy in Gdynia used public data to determine whether Nord Stream 2 AG responsible for the construction of a new gas pipeline from Russia to Germany with the same name will manage the project on the deadline 2019.

– I compared the marine units contracted for the construction of Nord Stream 2 with historical data on the previous project, ie Nord Stream 1, which is already operating – says our interlocutor. – It is highly unlikely that Nord Stream 2 will be operational by the end of 2019. Pressure tests and acceptance of investments may take about half a year, as in the case of Nord Stream 1.

Marszałkowski reminds that the main contractor for the work consisting in laying the undersea pipes is the company Allseas. – It will perform a stretch in the Gulf of Finland. The work has begun in recent days. It will also implement the longest stretch of about 850 km on the open sea – he calculates. – Meanwhile, Saipem is to do work on the German shelf, which I think could actually start.

The scientist calculated that three pipe-laying vessels worked on the construction of Nord Stream 1: Solitaire (Allseas), Castoro 10 and 7 (Saipem). The latter has been withdrawn. Currently, two of them work in the Gulf of Greifswald and Finland respectively. – Gazprom has contracted six vessels at Allseas, out of which three are three main and three auxiliary – says Marszałkowski.

– The problem starts here. Allseas can use only two units outside Solitaire: Audacia and Pioneering Spirit. The first along with the accompanying ship Fortitude has been in the direction of the Hague for over a week. The second is working in the Black Sea, probably at the construction of Turkish Stream – continues the interlocutor of BiznesAlert.pl. – I think that due to this, by the end of 2019, not even one of the two strands of Nord Stream 2 will be launched – he argues. This conclusion comes from the comparison of the Nord Stream 1 construction statistics. It started in April 2010. It began with the construction of a seagoing section in the Swedish exclusive economic zone. In June of that year, Castoro 10 started to work in German waters, and Solitaire in September.

– Meanwhile, at Nord Stream 2 construction outside the Finnish stretch has begun with a delay or has not moved at all. With optimistic assumptions that the construction of offshore parts would start in September and the pace would be optimistic for a 3 km gas pipeline per day, the central part will not be ready until June 2019. Only that you can not see that the work on its implementation has begun – counts Marszałkowski. This would mean that the delay of Nord Stream 2 will be at least half a year.

In his opinion, it will be difficult for Denmark to block the project, but it may delay it. – Denmark may delay the approval of construction in its territorial waters. For the blockade, it would need political determination and use of the environmental argument allowed by the Espoo Convention. In the Borhnolmic depths there are chemical weapons depots – indicates the interlocutor of BiznesAlert.pl. – Sweden has run out of that determination – he says.

In the scientist’s belief, starting work without Denmark’s consent may be a form of pressure to convince the Danes that they would be better off agreeing to build in their exclusive territorial waters, which will benefit financially than to block consent, which will not stop the project anyway. In addition, this may be a way to avoid US sanctions by formally starting construction. Obligations may not necessarily cover projects already started.

However, if Nord Stream 2 will have to wait for the revision of the route, as we wrote in BiznesAlert.pl, the delay in this respect may reach half a year. Together with this resulting from the later start of construction, it can turn into a twelve-month extension of the project.

BiznesAlert.pl business partners in the industry responsible for the construction of gas pipelines are less sure about delays in the Baltic Sea. In their opinion, they are possible to catch up thanks to the exceptional technical efficiency of the Solitaire ship.

Another problems

However, problems for Nord Stream 2 may appear elsewhere, i.e. in the construction of gas pipelines supplying the raw material for a new project from the territory of Siberia via the Uchta-Torżok and Uchta-Vyborg connections, which may extend until 2020 and in German territory in the case of the said EUGAL legends, which can also be created at the beginning of the next decade.

This means that although it is difficult to indicate today how to stop Nord Stream 2, its delay is real. Even if the construction of the sea section will accelerate and the existing backlogs will be removed, there may be problems with providing the accompanying infrastructure, which is to be built around 2020. An indirect scenario is possible, in which Nord Stream 2 will start working in 2019, but it will not be fully operational from the very beginning, for example it will use only one of two threads. However, in the worst-case scenario for Russians, problems will accumulate and the bus will be built at least a year later.

This uncertainty means that Gazprom will be forced to negotiate temporary solutions with current transit countries, such as Poland and Ukraine, which terminate transmission contacts in 2019. This will weaken the position of the Russian side, which its partners will be able to use to improve the terms of cooperation.



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