Nord Stream Pipeline

Why in News?

The Nord Stream 1, Germany’s main source of gas from Russia, was shut down for the scheduled maintenance work.

About Nord Stream Pipeline

Nord Stream consists of two pipelines, which have two lines each namely: Nord Stream 1 & Nord Stream 2.

• The Nord Stream crosses the Exclusive Economic Zones (EEZs) of several countries including Russia, Finland, Sweden, Denmark, and Germany, and the territorial waters of Russia, Denmark, and Germany.
  • In Germany, the pipeline connects to the OPAL (Baltic Sea Pipeline) and NEL (North European Pipeline) which further connects to the European grid.
• Owned by the Russian energy giant, Gazprom, Nord Stream, the longest subsea pipeline, is an export gas pipeline that runs under the Baltic Sea carrying gas from Russia to Europe.
• The gas for Nord Steam comes mainly from the Bovanenkovo oil and gas condensate deposit in Western Siberia.

Why is the Nord Stream Pipeline important for Europe and Russia?

• Europe requires more than 100 billion cubic meters (bcm) of natural gas each year and around 40% of its gas comes from Russia.
• Europe has become more dependent on gas imports because of a decrease in domestic gas production.
  • Reducing dependence on Russian gas is difficult as there are no easy replacements.
• There is no infrastructure to import LNG from exporters like Qatar and the U.S. and there are question marks over the desirability of shipping gas.
• Moreover, Germany’s transition to cleaner fuels by phasing out nuclear power and cutting reliance on coal has increased its dependence on Russian gas as gas is seen as a cleaner fuel.
• A reduction in gas from Russia would increase already high gas prices and that would not be popular domestically.
• As for Russia, which has the largest natural gas reserves in the world, around 40% of its budget comes from sales of gas and oil.

Recent Ukraine Tension & Nord Stream Pipeline

• For now, the fate of the $11 billion pipeline hangs in a balance as the Nord Stream 2 is being used as a bargaining chip by the West to force Russia to de-escalate tensions with Ukraine.