September 29, 2023


On Thursday morning, the Russia-to-Germany Nord Stream natural gas pipeline is due to resume deliveries.

It’s been offline for 10 days as part of routine annual maintenance — but politicians from Brussels to Paris to Berlin have warned this year is anything but ordinary.

Russian state-backed exporter Gazprom has already halted or reduced deliveries to 12 EU countries, and the fear is that Russian President Vladimir Putin will shut off the gas for good, in retaliation for sanctions on Moscow over its invasion of Ukraine.

The stakes are high.

Stopping flows ahead of winter would make EU energy markets go haywire amid a global gas shortage, and inflict serious damage on the bloc’s economy.

“Russia is blackmailing us, Russia is using energy as a weapon,” European Commission President Ursula von der Leyen warned on Wednesday in Brussels. “If we look in hindsight, we see that months before the war broke out, Russia kept gas supply intentionally as low as possible … therefore reducing the supply, tightening the market and driving up the prices.”

Earlier on Wednesday, the Commission floated a plan for sweeping new emergency powers to ration gas use across the bloc, citing a “significant risk that a complete and protracted halt of Russian gas supplies may materialize in an abrupt and unilateral way.”

“Whether it is a partial or a major cut-off of Russian gas, or a total cut-off of Russian gas, Europe needs to be ready,” von der Leyen added.

Earlier this week, the EU’s Budget Commissioner Johannes Hahn said Brussels was now “working on the assumption that [Nord Stream] doesn’t return to operation.”

Out of order?

For now, the signals from Moscow are that the pipeline will resume gas deliveries — though at lower levels than normal.

Day-ahead data on platforms used by gas market traders show that enough space has been booked to carry around 50 million cubic meters (mcm) of Russian gas on Thursday from Nord Stream further inland via two downstream gas links — the NEL and OPAL pipelines.

There are signs Vladimir Putin hopes the deep freeze on Nord Stream 2 is a hibernation rather than a Siberian death sentence | Matthew Stockman/Getty Images

Tom Marzec-Manser, head of gas analytics at commodity intelligence firm ICIS, called the bookings “a key indicator — which is not full proof — that Gazprom will resume flows … Thursday morning.”

The amount booked would mean Nord Stream would be running at about 30 percent capacity.

Before going down for maintenance, the line was operating at 40 percent capacity, which the company blamed on a missing gas turbine out for maintenance in Canada.

That turbine has reportedly been sent back to Germany, though it must still be transited to Russia for reinstallation.

On Tuesday, Putin told journalists in Tehran that gas flows through Nord Stream would resume on schedule at about 40 percent capacity — 60 million cubic meters per day (mcm/d) — if the turbine was returned in time.

“If not,” Putin added, Nord Stream would be able to send “only 30 million cubic meters per day.” That amounts to less than 18 percent capacity.

Several major European customers, including Uniper in Germany, have already received letters from Russia’s Gazprom invoking an act-of-God clause in supply contracts, arguing the reduced deliveries are outside its control.

Uniper has rejected that claim, while Kyiv has pointed out that Russia is actively refusing to reroute the gas via pipelines transiting Ukraine.

German Vice Chancellor Robert Habeck has publicly called the maintenance issue a false pretext.

That possibility was bolstered Tuesday when Putin dangled a proposition to immediately boost supplies to Europe while Nord Stream was down.

“We have another route ready — it is Nord Stream 2,” Putin said. “It can be launched.”

German authorities halted the administrative certification process for the Nord Stream 2 pipeline in February | Fabrice Coffini/AFP via Getty Images

It was a classically provocative statement from the Russian president. German authorities halted the administrative certification process for the Nord Stream 2 pipeline — a twin of the first link — in February, following Russia’s invasion of Ukraine.

The project is also under U.S. sanctions and in March laid off most of its staff.

But there are signs Putin hopes the deep freeze on Nord Stream 2 is a hibernation rather than a Siberian death sentence.

Just last week, the largely inactive pipeline company won a small victory in EU courts: It now has the right to challenge the bloc’s gas market rules and fight for its right to operate as built.

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