Nord Stream 2 – A Contested Pipeline

From the beginning on the Nord Stream 2 pipeline – envisaged to transport gas from Russia to Germany – has been contested. Geopolitical arguments were brought forward by Ukraine, Poland and the Baltic countries that cautioned against increased dependence of Germany and other European countries on Russian gas reserves. It would also hurt Ukraine that would lose a source of revenue from transit of Russian gas through its territory.

 

US’ opposition and Ukraine

These arguments, coupled with the US interest to export its shale gas to Europe, raised opposition in the US, particularly in the US Congress, against Nord Stream 2. For President Donald Trump hostility towards the project by the Congress was a gift, as he anyway saw Germany as a big enemy to be punished. By opposing Nord Stream 2 he could also show that he would not be soft on Russia. Therefore, he promoted and enhanced sanctions against companies who participated in the pipeline construction. Biden criticized this pipeline too, but he was not interested in a conflict with Germany. He was ready for a compromise which would send positive signals to Ukraine. Towards the end of July an “agreement” between the US and the German government was concluded. Germany should support financially the greening of Ukraine’s energy sector. It should develop a joint energy project with Ukraine and create possibilities of reverse flows of gas into Ukraine if needed. Additionally, Germany would push Russia for longer transit agreements with Ukraine. However, this agreement did not silence the criticism in the Congress and found strong opposition in Ukraine and Poland.

Whatever position one has to the concrete project and the new US-German compromise, the project as such was not the best from the beginning. I remember to have raised the issue with other colleagues in the European Parliament. We developed an idea of tripartite solutions between the Russian Federation, Ukraine and the European Union. They could have included joint ownership of the pipeline infrastructure going through Ukraine and other kinds of collaborative approaches. It could have contributed to an enhanced trans-European cooperation between the EU and Russia with the inclusion of Ukraine. It was clear from the beginning of Ukraine’s independence that energy transit would repeatedly raise problems and a cooperative solution should have been found. Of course, such a solution would have presupposed a more long-term strategic perspective.

Strangely enough, instead of more attempts to build new connections between the Western and the Eastern parts of Europe the trend goes in the opposite direction. Many in the West just want to cut off links with Russia and in Russia, similar attitudes prevail. Unfortunately, today Europe seems more divided between East and West than in the times of the Soviet empire. However, the dissolution of the Soviet Union should not have resulted in a stronger division of Europe than during the communist times. I understand Ukraine’s concerns and those of some countries that suffered under the Soviet dominance. Nevertheless, the European Union should try to keep contacts with Russia alive, without illusions about their depth.

 

Putin’s strange history lecture

Unfortunately, Russia is not being helpful in the attempts to overcome mistrust and skepticism prevailing in many European countries. When one reads the recent article by Vladimir Putin titled “On the Historical Unity of Russians and Ukrainians” one can have doubts about the readiness of the Russian President to recognize and respect Ukraine’s independence. Putin presents a very strange and one-sided historic narrative. He sees centuries-long history as a consecutive chain of anti-Russian activities, undertaken primarily by Poland, but also by the Austro-Hungarian empire.      

This anti -Russian strategy allegedly got hold of Ukraine as well, thanks to specific support of neo-Nazis inside Ukraine! Russia is always surrounded by enemies – Putin argues – who desire its defeat and try to reduce its territory. Therefore, Russia is constantly forced to defend itself. Losing Ukraine and Belarus as close partners would hurt Russia strongly and would be detrimental to the Ukrainians and Belarusians themselves.

Despite such one-sided interpretation of history by Russian political class, a strong European Union should have an interest not to interrupt all economic links with the country. Those could and should go parallel to strong ties with Ukraine. The US-German agreement presents some important examples of close EU-Ukraine cooperation and of the inclusion of Ukraine into the European Green Deal. But Ukraine must also strengthen its own efforts to reform and combat corruption more efficiently. Many international organizations would help more quickly and more comprehensively if the Ukrainian authorities realized reforms – thereby meeting preconditions for support – with more energy and speed.

 

Let us develop a long-term strategy

In the meantime, besides geopolitical arguments environmental opposition against Nord Stream 2 has been raised. The urgent need to combat climate change and reduce CO2 emissions has shown that the pipeline project is outdated. On the other hand, availability of sufficient gas supplies would help eliminate dependence on coal. In addition, gas will be needed as a transitional energy resource for some time until enough sources of cleaner and sustainable energy become available. Thus, in the long-term Europe will indeed need less gas, but we still have a delicate transition in the energy production system before us. To smooth away this transition Europe needs gas, including from Russia.

Certainly, the Nord Stream 2 pipeline will remain a contested project. Nevertheless, it would be absurd to stop the project after so much investment has been put into it. More importantly, a lesson should be learned from the short-sightedness this project is founded on. A longer-term and comprehensive strategy would have been to opt from the beginning on for energy cooperation between Germany and the EU on one side, and Russia on the other, but with inclusion of Ukraine. Such cooperation would contribute to the strengthening of a new European security system after the breakdown of the Soviet Union. We cannot know whether Russia would have agreed to such a strategy. However, it does have a big interest in servicing Europe’s energy demand. Of course, the EU should have undertaken stronger efforts to diversify its gas imports. In the European Parliament, I had a chance to work with a conservative Polish member on a report supporting the EU’s energy diversification strategy. Unfortunately, the member states did not support this strategy.

Ultimately, even beyond the energy question, we should not accept forever that Europe should be divided between East and West, even with a Russian President who cannot accept new realities.


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Dr. Hannes Swoboda, President of the International Institute for Peace (IP), started his career in urban politics in Vienna and was elected member of the European Parliament in 1996. He was Vice President of the Social Democrat Group until 2012 und then President until 2014. He was particularly engaged in foreign, enlargement, and neighborhood policies. Swoboda is also President of the Vienna Institute for International Economics, the Centre of Architecture, the University for Applied Science - Campus Vienna, and the Sir Peter Ustinov Institute.