Europe's Failed Natural Gas Strategy: Gazprom Hopes to Build Second Baltic Sea Pipeline

Der Spiegel ^ | 05/18/2012 | Frank Dohmen and Alexander Jung

[Olog-hai]

With the planned Nabucco natural gas pipeline in southern Europe hitting snag after snag, Russian natural gas giant Gazprom is considering the construction of a second Baltic Sea pipeline to go with the just-finished Nord Stream. With unconventional natural gas from the US flooding the market, however, the strategy is not without risk. …

Indeed, it is beginning to look as though the erstwhile competition between the two pipelines has been overwhelmingly won by Nord Stream. (Gerhardt) Schröder's team has just decided to expand the Baltic Sea pipeline's capacity.

The owners, Gazprom, E.on-Ruhrgas, Wintershall, Gaz de France and the Dutch firm Gasunie, are investigating the construction of a second pipeline through the Baltic Sea, which is likely to be built close to the existing line. The end result would be a dual pipeline that could begin transporting additional billions of cubic meters of gas from Siberia directly to northern Europe in seven to eight years.

The scenario that seems to be unfolding—an expansion of northern supply lines and a downsizing of southern routes—will bring turmoil to the entire natural gas market in Europe. The European Union had conceived Nabucco as a way to broaden its source of supply. Instead, however, the apparent failure of Nabucco and the expansion of the Baltic route threatens to make the EU more dependent than ever on Russian sources.

Europe already buys about a quarter of its natural gas from Russia with Germany relying on the country for 35 percent of its needs. This makes Germany vulnerable. …

[SunkenCiv]

Thanks Olog-hai.