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Timing of Nord Stream 2 gas link startup dependent on German regulator: official


Follows reports of plans to begin flows in October

Operator to inform about further steps 'in due time'

Pipelaying work completed on Sept. 6

  • Author
  • Stuart Elliott
  • Editor
  • Alisdair Bowles
  • Commodity
  • Energy Natural Gas
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  • United States

The start date for commercial gas flows through the Nord Stream 2 gas pipeline from Russia to Germany will be dependent on approval from the German regulator, a senior Russian official said Sept. 9.

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At a briefing, Russian foreign ministry spokeswoman Maria Zakharova said Moscow hoped that flows could begin "soon" via the new 55 Bcm/year pipeline.

"The timing of the start of commercial supplies depends on the position of the German regulator," Zakharova was quoted as saying by the Tass news agency.

Nord Stream 2 AG, the Switzerland-based operator of the pipeline, applied in June for certification as an independent transmission operator with the German regulator, the Bundesnetzagentur (BNetzA).

This certification would be needed before commercial deliveries via the pipeline could begin.

Gazprom has reportedly been planning to launch first flows at the start of October, but it seems probable that it would not be able to do so without approval from BNetzA.

Gazprom had no comment when contacted by S&P Global Platts on either the remarks by Zakharova or the reported October plan.

A Nord Stream 2 spokesperson, meanwhile, referred Platts to its statement on Sept. 6, which said the pipeline operator's goal was to begin operations before the end of 2021.

"We will inform about further steps in due time," the spokesperson said.

Two-string line

Pipelaying work on Nord Stream 2 was completed on Sept. 6 with the final welding on the second 27.5 Bcm/year string, paving the way for pre-commissioning work to take place.

The first 27.5 Bcm/year string was completed in June, and pre-commissioning work has been ongoing since then.

The completion of pipelaying of the 2,460 km two-string pipeline system marks the end of a lengthy delay to the project after the threat of US sanctions saw previous pipelaying work on the pipeline halted in December 2019.

The availability of Nord Stream 2 is a key factor currently impacting the European gas market, with benchmark prices having broken through the Eur55/MWh mark on continued supply concerns.

Gazprom on Aug. 19 said it could still supply 5.6 Bcm of gas via Nord Stream 2 in 2021, but company officials on Aug. 31 said flows via the pipeline would not have a "major" impact on overall supplies to Europe for the year as a whole.

Regulatory review

Meanwhile, a spokesperson for BNetzA told S&P Global Platts last week that the documents submitted for the unbundling certification procedure were still being reviewed.

"Whether or which documents will be requested subsequently is open. Once the application documents are complete, the Bundesnetzagentur has four months to prepare a draft decision," the spokesperson said.

Should the pipeline begin operations while the case is pending, the operator could be subjected to penalties, the spokesperson said.

However, the regulator could allow flows to begin as part of its draft decision provided it gives justification for doing so.

Once BNetzA publishes its draft decision, it then passes to the European Commission to give its opinion before being returned to the German regulator for a final decision, a process that could also take up to four months.

The pipeline must also be technically certified as complete, a task made more difficult by the withdrawal from the project of certification company DNV due to the threat of US sanctions.

S&P Global Platts Analytics said Sept. 6 it still expects first flows from Nord Stream 2 in October, but the lack of certifications presents a risk of delay.