Nord Stream 2 Exemption from Imminent Bankruptcy Proceedings: Company Remains Active in Hunt for Investors
Hear this, mate: The Swiss court's recent approval of an insolvency agreement grants Nord Stream 2 AG temporary leeway to secure investors, thwarting an insolvency procedure for now. Crafted during two and a half years of negotiations, this agreement leaves major creditors - Engie, OMV, Shell, Uniper, Wintershall - nursing significant financial losses. They invested hefty sums in the construction of the Nord Stream 2 pipeline, which cost roughly ten billion euros. Despite the court verdict, an appeal remains a possibility, leaving the financial losses unknown.
Some whispers claim US investor Stephen P. Lynch could seize the pipeline, envisioning this as a means to steer European energy supply under combined US-European control. However, prior to Russia's attack on Ukraine, US politicians condemned Germany's gas dependence on Russia. Russia responded by cutting off deliveries, prompting Germany to switch supply sources, leaving Nord Stream 2's gas untouched today.
A Green politician, Michael Kellner, voiced his discontent over potential plans to reactivate Nord Stream 2, stating, "This stinks. barely has Habeck left, obstacles for the use of Nord Stream 2 are shooed away." Even gas market analyst Heiko Lohmann from the dpa news agency expresses skepticism about the pipeline's future, proclaiming, "From an economic point of view, I don't see a future for Nord Stream 2."
First built in 2020, the pipeline was meant to transport Russian natural gas through two 1200-kilometer pipelines across the Baltic Sea to Germany. However, despite construction completion, it never saw operation.
Expanding Horizons:
There's a buzz around the potential lifting of US sanctions on Nord Stream 2, though these discussions are part of broader negotiations to end the Russia-Ukraine conflict. It's a significant policy shift, though, that would need to happen. Simultaneously, the EU has threatened to impose more sanctions if Russia fails to agree to a ceasefire, showing opposition to the pipeline's operation under current conditions.
A possible resolution could be changing ownership stakes to meet EU regulations, perhaps with US investors taking the lead. However, Gazprom's reluctance to forfeit its pipeline assets presents a substantial obstacle.
Enrichment Data:The pipeline remains under U.S. sanctions (reimposed post-2022 Russia-Ukraine invasion) and faces legal challenges due to the EU's 2024 Gas Directive, which poses restrictions on Russian ownership. The EU is committed to reducing its reliance on Russian energy, making its operation uncertain without significant changes in ownership or policy. Ongoing discussions revolve around potentially lifting US sanctions as part of broader peace negotiations. The EU has also threatened to impose further sanctions if Russia doesn't agree to a ceasefire, indicating strong opposition to its operation under current conditions. The pipeline's future may rely on changes in ownership or control, possibly involving US investors to meet EU regulations. Yet, Gazprom's reluctance to sell its pipeline assets poses a substantial barrier.
The Swiss court's temporary leeway for Nord Stream 2 AG is crucial for securing investors, despite the insolvency agreement carrying significant financial losses for major creditors. Energy industry discussions involve US investor Stephen P. Lynch, who seeks to seize the pipeline for combined US-European control. The EU threatens more sanctions if Russia fails to agree to a ceasefire, showing opposition to the pipeline's operation under current conditions. Potential resolution includes changing ownership stakes to meet EU regulations, with US investors possibly taking the lead. However, Gazprom's reluctance to forfeit pipeline assets presents a substantial obstacle. U.S. sanctions and the EU's 2024 Gas Directive, which limits Russian ownership, add legal challenges to the pipeline's operation. Thus, the pipeline's future may rely on changes in ownership or control, possibly involving US investors, to meet EU regulations, while Gazprom's resistance remains a hurdle. This situation unfolds amidst the backdrop of broader negotiations to end the Russia-Ukraine conflict.