EU Seeks to Negotiate with Russia Over Nord Stream 2 Gas Pipeline



Reuters

COPENHAGEN/BRUSSELS, March 29 (Reuters) - The European Union is seeking a mandate from member countries to negotiate with Russia over its plans to build a second pipeline to export more gas into Europe via the Baltic Sea to Germany, an EU document showed, as some EU states worry that the project will make Europe too reliant on Russian gas.

The Nord Stream 2 pipeline would pass through Danish and Swedish waters and would displace Russia's need to export gas to Europe via Ukraine, where it has a transit agreement which ends in 2019.

Eastern European and Baltic Sea states fear a new pipeline will make the EU even more dependent on gas from Russia, whose state-controlled exporter Gazprom already supplies a third of the bloc's needs. Germany and other beneficiaries in north Europe back the plan.

The European Commission and German regulators are at odds over whether EU law should apply to the pipeline.

In a March 28 letter addressed to Denmark and Sweden, the Commission said it was inviting all EU states to voice their concerns and would seek a mandate from EU energy ministers to negotiate an agreement with Moscow on behalf of the bloc.

"It is our view that a specific legal regime would need to be established for the offshore section, and that such specific legal regime should include some fundamental principles stemming from EU energy law," the Commission said.

"It cannot be built or operated ... in a legal void."

Discussions would focus on how EU rules aimed at ensuring competitiveness and transparency in the gas market could be applied to the offshore pipeline, the Commission said.

"We are pleased that the government's effort to get the commission's assessment has borne fruit and we are now reading and evaluating the response from the commission, which contains complex issues," a spokesman for Denmark's foreign ministry told Reuters.

EU diplomats said the Commission might struggle to secure enough support from member states given the project has the backing of Germany, the bloc's biggest economy that will host the end-point for the 55 billion cubic meter a year pipeline.

Under EU rules, two-thirds of the 28 EU member states representing two-thirds of the bloc's population would need to back the offer for the EU to open talks with Russia, Commission spokeswoman Anna-Kaisa Itkonen said.

The Commission has negotiated a legally-binding treaty with third countries on a pipeline on behalf of EU members in the past, when it held talks with Azerbaijan and Turkmenistan over the Trans-Caspian pipeline.

EU diplomats said Russian President Vladimir Putin would have to take any decision to abandon or modify plans by Gazprom, which has gas export monopoly.

The March 28 letter responded to a request made this year by Denmark and Sweden for the Commission to intervene on Nord Stream 2 before the two states decide on permits. EU diplomats said there was little scope for either nation to block the plan.

(Editing by Edmund Blair, Greg Mahlich)



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