Big Politics at Work Behind Nordstream 2

February 2018, Vol. 245, No. 2

Figure 1: Nordstream 2 pipeline Source: Gazprom
Figure 1: Nordstream 2 pipeline
Source: Gazprom

The supply of Russian natural gas across the Baltic Sea to Germany and onward to central and western Europe could be doubled by the proposed $10.6 billion (€9.5 billion) Nordstream 2 (NS2) pipeline.

The 759-mile (1,200 km) pipeline, running parallel to Nordstream 1, will add 55 Bcm delivery capacity, establishing Germany as a center in Europe’s gas market and replacing the declining output from the North Sea.

NS2, led by Gazprom in a joint venture  with some of Europe’s largest energy companies including Germany’s Eon and BASF/Wintershall, France’s Engie, Austria’s OMV and Dutch Shell, could be completed in late 2019.

It will deliver gas from the Nadym-Pur-Taz region of Siberia by overland pipeline to the Baltic Sea port of Ust-Luga near St. Petersburg, where it will enter the proposed NS2 subsea pipeline. At the other end of NS2, the gas will enter the German gas pipeline network at the German Baltic port of Greifswald.

The developers stress multiple mutual benefits from NS2, including  a ($6.05 billion (€5.15 billion) multiplier effect from this investment alongside 31,000 full-time equivalent jobs and increased competition, leading to reduced gas prices for European consumers. Gas supplies would be reliable, increasing Europe’s energy security, supporting climate goals and improving the EU’s internal energy market.

However, in 2016, Nordstream 1 ran at just 80% capacity, delivering 43.8 Bcm, or enough for 20 million households. While Europe’s domestic gas output is declining, demand is also falling, down 12.5% across Europe over the last decade, according to the BP Statistical Review. Russia currently has a 34% market share of Europe’s gas market. A second pipeline such as NS2 could increase Russia’s share to as much as 40% and destroy the EU’s goal of diversifying gas supply.

Project Delivery

The completion of the pipeline includes a variety of stages, including design, construction, pipe laying, and quality control.

The walls of the steel pipes will be 41 mm thick and covered with an external coating to prevent corrosion. The pipes will have a constant internal diameter of 1,153 mm and a high-gloss lining to reduce friction to the gas flowing through the system.

Continue Reading https://pgjonline.com/2018/02/20/big-politics-at-work-behind-nordstream-2/

 

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