Denmark has opened the way for the completion of the Russian-led Nord Stream II pipeline natural gas project for Western Europe to compete with LNG after previous delays caused by threats of US sanctions.
Construction of the 1,230-kilometres pipeline is almost complete, apart for a final stretch of around 120 kilometres in length in Danish waters.
The Danish Energy Agency said it would allow the Gazprom-led project to use pipe-laying vessels with anchors instead of the more advanced ships using self-positioning technology and which are affected by US sanctions imposed in December 2019.
The US considers the Nord Steam II project a security risk to Europe, though both Russia and most European Union members have condemned Washington’s sanctions.
Germany is the main EU supporter of Nord Stream II and has been accused by several EU members, including Poland, of encouraging the EU energy security policy of building LNG import terminals to reduce dependence on Russian pipeline gas while encouraging the new Gazprom pipeline project to supply Western Europe.
Nord Stream II also bypasses EU LNG importers Poland and Lithuania, as well as the traditional pipeline transit nation Ukraine, on its route under the Baltic Sea from the Russian port of Ust-Luga, near St Petersburg, to Greifswald in northeast Germany.
The Swiss-Dutch subsea company Allseas, which was laying the dual pipelines using two vessels, the “Pioneering Spirit” and the “Solitaire”, halted its work to avoid US sanctions.
With Allseas leaving the project, the Russians have taken over and President Vladimir Putin assured the Russian public that the pipeline would be completed without international assistance.
The Nord Steam II project's two parallel pipelines will be able to transport 55 billion cubic metres per annum of natural gas from Russia to Germany.
After starting in Russian waters, the pipelines pass through Finnish, Swedish, Danish and German marine areas before making their landfall on the German coast.
Still, even if Gazprom completes the project, the company will have to face legal obstacles related to its operation within the EU internal market.
The EU extended its internal gas market regulations in 2019 to pipelines to and from non-EU countries.
Under the amended law, Nord Stream II must adhere to third-party access (TPA) and tariff regulations for pipelines entering EU member territory as well as to the principle of unbundling, whereby the transmission and ownership of natural gas need to be separate from each other.
Analysts say this is a problem for Gazprom because of its vertically integrated structure.
The Russian company could, however, avoid the new EU rules if it is awarded an exemption by the national energy market regulator of the EU member state where the pipeline enters the EU - Germany’s Federal Network Agency.
Meanwhile, a Russian vessel, the “ Fortuna”, which is potentially able to complete the Nord Stream II pipeline, was heading for Danish waters, according to shipping data.
The “Fortuna” is a pipe-lay crane vessel that was built in 2010 and is sailing under the Russian flag.
In the decision to let the Russians lay the pipes, the Danish Energy Agency emphasized, among other things, that the remaining part of the pipelines must avoid certain areas of the sea bottom where deep trawling, anchoring and seabed interventions are discouraged due to the risk posed by “dumped chemical warfare agents”.
“The decision is made in accordance with the Continental Shelf Act and on the basis of Denmark's obligations under the UN Convention on the Law of the Sea,” said the Danish statement.
“Here, Denmark is obliged to allow the construction of transit pipelines with respect for safety and resources rules and the environment,” stated the Danes.
