Nord Stream 2 applies for third Danish pipeline route

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Nord Stream 2 has filed the third application in two years for a gas pipeline through its territory in waters to the south of the island of Bornholm, which is located between Sweden and Poland in the Baltic Sea, close to the Polish border. The pipeline, when completed, is set to transport 55 billion cubic metres of natural gas every year from Ust-Luga, Russia to Greifswald, Germany.

A statement from the company said: "Today, more than two years after submitting its first application for a route through Danish waters, Nord Stream 2 AG has submitted a third application. The third application, together with the Environmental Impact Assessment (EIA), covers a route in the Danish exclusive economic zone (EEZ) in the waters south of Bornholm. This application and the EIA has been submitted in accordance with the decision made by the Danish Energy Agency (DEA) on March 26, 2019."

The decision mentioned in the statement refers to the DEA's recent request that Nord Stream 2 carry out an environmental impact assessment of the route.

This will be the third request in two years: 

  • The first application was made in April 2017 for a route that crossed to the south of Bornholm. 
  • The second was made in August 2018 for an alternative route through the Danish EEZ through waters to the north-west of Bornholm.

According to Nord Stream 2, the second request was made after a new law, which was applied retroactively, came into force and meant that the Danish Foreign Minister must assess the project to see if it is compatible with foreign policy and security and defence interests.

The statement said: "In January 2018, the amended Danish Continental Shelf Act entered into force with retroactive effect only for the Nord Stream 2 project. The law gives the Danish Minister of Foreign Affairs the right to veto infrastructure projects running through territorial waters on political grounds. Such a judgement from the Ministry of Foreign Affairs has now been pending for 16 months. Nord Stream 2 AG has not received any response at all."

In a sign of the pipeline developers' growing frustration with what they consider to be political delays, the statement went on to describe the Danish authorities' actions as a "violation of investors' trust".

The statement continued: "It is incomprehensible why there has still been no decision on the route through territorial waters after 16 months since entry into force of the amended Danish Continental Shelf Act, and why there has been no decision on the route north-west of Bornholm even though there have been and are no relevant environmental or safety objections against this route. Asking for a third route option to be developed, despite two fully processed, ready-to-be-permitted applications on the table, can only be seen as a deliberate attempt to delay the project’s completion."

Nord Stream 2 has said this third application is a "mitigation measure" before slating the Danish actions as undermining "fundamental Danish constitutional and European law principles of legitimate expectations and legal certainty," as well as being "not compliant with the good faith principle required by UNCLOS 1982."

A statement by the DEA said: "The Danish Energy Agency will now process the application and initiate the environmental assessment process. This includes, among other things, a public consultation of the environmental impact report for the project with accompanying appendices... Subsequently, the Danish Energy Agency, in cooperation with the developer, shall address the received responses. The length of this part of the case processing will depend on the number, content and complexity of the consultation responses. This means that the Agency currently cannot say when a permit can be granted."

Finland, Germany, Russia and Sweden; the countries through which Nord Stream 2 would pass, have already granted permits. So far nearly 1,000 km, out of a total of 1,200 km, of pipeline have already been laid and the terminals in Russia and Germany are near completion.

The Swiss-based, largely Russian-owned project has been a source of division throughout Europe and geopolitical analysts have been watching the situation carefully. The decision by Denmark appears to be a setback but it has not put the issue to bed. Germany, backed by France, the Netherlands and the UK claims that it needs the project to secure the country's ever rising thirst for gas. Russian President Vladimir Putin has said that the project is a commercial venture only and is free from politics. Hungary and Bulgaria, widely seen as the most pro-Russian eastern European countries, have no reservations over Nord Stream 2.

The Ukraine, however, is concerned that the pipeline will see a dramatic loss of revenues from current gas transit fees. which could lead to further instability and the potential breakup of the war-torn country. Poland, Romania and the Baltic States all have similar concerns to Kyiv over the pipeline.

The US has hit out at the project, claiming that it will make Germany and Europe dependent on Russia and its gas for the continent's energy security.

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