Nord Stream 2

Nord Stream 2 “a generational geopolitical win for Putin” says Ted Cruz


Washington and Berlin have struck a compromise deal to allow completion of the controversial Nord Stream 2 gas pipeline, according to a joint statement released by both countries on Wednesday (July 21). The Russian pipeline is nearly complete despite the threat of US sanctions against Moscow.

The $11 billion undersea pipeline that will double the volume of natural gas exported directly to Germany via a network beneath the Baltic Sea, bypassing an existing route through Ukraine, has long been opposed by Washington, which argues Europe will become more dependent on Russian gas.

When completed, NordStream 2 will span 1,230km (764 miles) from Russia’s Arctic region  to Germany, making it one of the longest offshore gas pipelines in the world. Last month, Moscow said that only 62 miles of Nord Stream 2 were left to build.

As part of the deal, the U.S. and Germany committed to supporting a $1 billion “Green Fund” for Ukraine aimed at improving the country’s energy independence. “Germany will provide an initial donation to the fund of at least $175 million and will work toward extending its commitments in the coming budget years,” the agreement stated.

And, Berlin guaranteed that it would reimburse Kyiv for gas transit fees it will lose from being bypassed by Nord Stream 2 until 2024, with a possible 10-year extension. Ukraine stands to lose about $3bn a year in gas transit fees.

German Chancellor Angela Merkel spoke on phone with Russian President Vladimir Putin about Nord Stream 2, hours before the deal’s announcement, her office said. “Energy issues such as gas transit through Ukraine and the Nord Stream 2 pipeline were also topics of the conversation,” Deputy spokesperson for the German government, Ulrike Demmer, said.

In a statement released on Wednesday, the Kremlin rejected the pipeline’s negative associations, saying that it had never used energy a political weapon. But the Russian government also said, following the call between Merkel and Putin, that both leaders were “satisfied” with the near completion of Nord Stream 2.

Nord Stream 2 is nearly 98% complete and like its already operational twin Nord Stream, the new pipeline will have the capacity of 55bn cubic metres of gas per year to Europe.

Despite the agreement, there is opposition to the pipeline in the U.S. Congress, as well as in Ukraine and Poland.

The top Republican on the House Foreign Affairs Committee, Rep. Michael McCaul of Texas, said he had no doubt Russia “will use the Nord Stream 2 pipeline as a weapon of coercion against Ukraine and transatlantic energy security as soon as it is operational. Promises to invest in future Ukrainian energy projects and ambiguous threats of consequences won’t change that reality.”

Texan Senator Ted Cruz said the agreement would be “a generational geopolitical win for Putin and a catastrophe for the United States and our allies.”

Ukraine’s Foreign Minister Dmytro Kuleba said in a tweet that the pipeline “threatens Ukraine’s security.” He also issued a statement with his Polish counterpart Zbigniew Rau, pledging to work together to oppose Nord Stream 2.

In Germany, top members of the environmentalist Greens party said the agreement would benefit Putin and weaken Ukraine.

With reporting by DW, Reuters, CNCB