Danish Regulator Removes Key Obstacle to Nord Stream 2's Completion
Denmark's energy agency has given the thumbs up for a request from the developers of the controversial Nord Stream 2 gas pipeline for the use of anchor-positioned vessels for pipelaying. The previous permit only allowed the use of DP-enabled vessels, ruling out a Russian anchor-equipped pipelay barge for use on construction.
The United States opposes Nord Stream 2, which will carry Russian natural gas to European markets via two parallel pipelines under the Baltic Sea. The route bypasses Ukraine's gas network, and its deployment could deprive the Ukrainian government of revenue during its long-simmering conflict with Russian-backed forces. The pipeline has only one 65 nm segment through Danish waters to go in order to reach completion.
Last year, the U.S. Congress passed a law requiring the U.S. Treasury to identify the top executives and owners of any foreign pipelay vessel operators engaged in work on the Nord Stream 2 and Turkstream pipelines. If the covered vessel activity continued after a 30-day wind-down period, the designated individuals would have been personally banned from the United States and the Treasury would have been required to freeze their U.S.-domiciled assets. The measures applied solely to Swiss operator Allseas, whose vessels Pioneering Spirit and Solitaire were at work on Nord Stream 2. Allseas complied and wound down its operations in December, leaving Nord Stream 2 without a pipelay contractor.
Gazprom, Nord Stream 2's developer, announced plans to move forward with the pipeline using Russian-owned assets. The Russian pipelay barge Fortuna is located in the Baltic and is capable of handling pipe of the size required, but she relies upon anchors to hold position, not the maneuverable DP systems used by Solitaire and Pioneering Spirit. The terms of Nord Stream 2's permit required DP operation (a restriction that has now been lifted).
Another Russian pipelay vessel, the Gazprom-owned and DP-enabled Akademik Cherskiy, recently redeployed from the Far East to the Baltic. Both Fortuna and Akademik Cherskiy are currently moored at the port of Mukran, Denmark, the staging point for the construction of the Danish segment of Nord Stream 2.
An additional sanctions bill sponsored by Senators Ted Cruz and Jeanne Shaheen was introduced in the U.S. Senate in June. If passed, the bill would expand the risk of American sanctions penalties to cover the pipelay vessels' insurers, any providers of vessel technology and welding equipment upgrades, and any firms providing the testing and certification of the pipeline itself (classification services).