12 Aug 2020, 13:55
Alex Dziadosz

Nord Stream 2 pipeline could be delayed or fail, Uniper risk report says

Frankfurter Allgemeine Zeitung / Süddeutsche Zeitung

Utility Uniper says there could be further delays to the controversial Nord Stream 2 gas pipeline project, or possibly even a failure of the project altogether, Helmut Bünder writes in the Frankfurter Allgemeine Zeitung (FAZ). Uniper, which is involved in the project as an investor, said in its half-year interim report 2020 that the threat of American sanctions on the project had increased the likelihood that there may be “a delay or even non-completion of the pipeline.” If the pipeline is not constructed, Uniper may have to impair the loan it made available for the pipeline and forfeit the planned interest income, the company said. The FAZ notes that the loan amounts to about 950 million-euros. "The Nord Stream 2 project failure risk continues to qualify as a major individual risk for Uniper,” the company report said. Uniper CEO Andreas Schierenbeck stressed that the company still expected the pipeline to be completed, even if it was obligated to think of “worst case” scenarios. CFO Sascha Bibert said: “Our basic planning is based on the completion of the line and that gas will flow.”

Last week, three Republican senators threatened the US would impose "crushing” sanctions on the port of Sassnitz over the construction of the pipeline, which will connect Germany with Russia via the Baltic Sea. Washington says the pipeline undermines European security by making the bloc more reliant on Russian energy supply. The government also wants Germany to import liquefied natural gas (LNG), particularly from the United States.

The threat has sparked outrage in Germany, and companies involved in the project have called for political support. Germany’s foreign minister Heiko Maas also rejected the sanctions threats after a meeting with Russian foreign minister Sergey Lavrov, the Süddeutsche Zeitung reports. "No state has the right to dictate its energy policy to the EU. And that will not succeed either," Maas was quoted as saying.

The pipeline has also proven controversial within Europe. Germany's eastern neighbours have criticised it as a bid to circumvent their territory in energy trading. It has also been repeatedly challenged by environmental groups who say both it and the alternative LNG imports from the United States have little room in Germany's green energy transition.

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