A brief history of Nord Stream
Nord Stream was controversial from the very moment it was proposed, some two decades ago. The plans ignited a furious and often bitter lobbying contest that lasted years and ultimately drew outside powers into the debate. The geopolitical conflicts which underpinned this controversy, however, are far older. This history drew to a point in the months before Russia’s February 2022 invasion of Ukraine, and is crucial to understanding the destruction of the pipelines.
Pipelines have been used to transport Siberia’s vast bounty of natural gas to Europe for more than half a century. From the beginning, this caused deep concern in Washington, with US presidents as far back as John F Kennedy and Ronald Reagan imposing embargoes and applying diplomatic pressure to prevent the trade. Nevertheless, West Germany started receiving natural gas by pipeline from the USSR in 1973, and 20 years later the newly reunified Germany was importing some 25.7 billion cubic metres through pipelines from Russia, according to Deutsche Welle.
The collapse of the Soviet empire at the beginning of the 1990s presented the newly formed Russian Federation with a problem: its gas pipelines – a crucial source of export revenue and hard currency – now passed through third countries who demanded transit fees and used their ability to prevent gas transport to the rich markets in Western Europe to secure better prices for their own deliveries.
These transit-and-supply negotiations were especially difficult with Ukraine. A poor country with monstrously energy-inefficient infrastructure and industries, Ukraine was economically reliant on cheap Russian gas, which Moscow had provided at a discount to friendly governments in Kiev. After the pro-Western Orange Revolution in 2005, however, negotiations became increasingly fraught, with Russia insisting on raising gas prices toward market rates, and Ukraine racking up massive debts for unpaid supplies and diverting gas intended for Europe. Matters deteriorated to the extent that Russia even cut off gas deliveries to Ukraine altogether for periods in 2006 and 2009, causing great alarm in Europe, whose own deliveries were affected by the impasses.
To resolve these issues, Russia proposed the construction of two maritime pipelines, Nord Stream and South Stream, that would bypass the transit countries, such as Poland, Belarus, Ukraine, Slovakia and the Czech Republic. Nord Stream would travel from Vyborg, a Russian port near the Finnish border, 750 miles through the Baltic Sea to the coastal town of Lubmin, near Greifswald, in Germany. South Stream would travel from Anapa in Russia for almost 600 miles through the Black Sea to Varna in Bulgaria.
The transit countries were vehemently against these proposals. In addition to the lost transit fees, they argued (understandably) that the new pipelines would hand Russia increased leverage over them, as the Kremlin would be able to turn off the taps without jeopardising supply to its all-important Western European (and especially German) market.
Russia won the argument on Nord Stream, whose two parallel pipelines were officially opened in 2011 at a ceremony in Germany attended by then President of Russia Dmitry Medvedev, then Chancellor of Germany Angela Merkel, and the Prime Minister of the Netherlands, Mark Rutte. The transit countries, though, got their way on South Stream, which was cancelled, prompting the Germans and Russians to shift toward the construction of a second gas pipeline project through the Baltic Sea, Nord Stream 2.
Gazprom, a publicly listed company in which the Russian state owns a 50 per cent plus one share controlling stake, held a controlling majority in Nord Stream AG, the company that ran Nord Stream 1. German energy giants, such as Wintershall and E.ON Ruhrgas, also held significant stakes, as did French and Dutch energy multinationals. Infamously, Gerhard Schroder, the Chancellor of Germany from 1998 to 2005, was the Chairman of the Board. Nord Stream 2 AG was to have a similar shareholder composition, with Gazprom holding a controlling stake, and the other near 50 per cent being held by German and other European energy giants.
It is easy to understand why Germany was so politically and financially committed to the nine-billion-euro Nord Stream 2 project. Its two parallel pipelines would have taken the total gas deliveries from Russia to Germany via the subsea Baltic route to 144 million cubic yards, feeding the country’s powerful industrial sector with all the energy it needed from the economically most rational source – and theoretically free from issues with the transit nations – thus buttressing Germany’s entire economic model for the foreseeable future.
Furthermore, natural gas was of cardinal importance to Europe’s push toward green energy. Emitting less carbon dioxide than coal and oil, natural gas could be used as a ‘bridging’ energy source while the continent fully electrified and developed renewable energy sources. Eventually, natural gas would also be used as a feedstock to kickstart the hydrogen industry, which itself was seen as vital for the EU’s green industrial future. Without Russian natural gas, European carbon ‘net zero’ commitments – elements of which the European Parliament and many national legislatures had written into law – would be much more expensive, if achievable at all.
The problem for Germany and the EU was that by the time the planning and construction of Nord Stream 2 started, Ukraine had returned to the stage. Moscow viewed the 2014 Maidan Revolution as a US-fomented putsch and the ostentatiously Ukrainian nationalist, pro-Western Government it put in place as an existential risk to Russia’s security interests. In response, Russia invaded and then annexed the Crimean Peninsula and backed separatists in the Donbass, who had taken advantage of an uprising against the new Kiev Government to carve out of Ukraine two de facto independent states centred on the important industrial cities of Donetsk and Lugansk.
Sanctions against Russia followed, but more importantly for Russo-German Nord Stream 2 plans, Ukraine gained significant lobbying influence in Washington, DC. As we have seen, the United States had been opposed to Russia supplying Europe with inexpensive pipeline natural gas since the 1960s – and now it had the bit between its teeth.
Matt Taibbi, the investigative journalist, has chronicled the effect of this alignment of Ukrainian and American interests. In 2018, the then-US President, Donald Trump, used a now-infamous speech at the UN to castigate the attending Germans for cooperating with Russia on Nord Stream 2. A year later, he imposed sanctions on the European companies contracted to build it, triggering outrage in Brussels and Berlin. Jeanne Shaheen, Senator for New Hampshire, said of the sanctions that the US could not stand by “while the Kremlin builds this Trojan horse”.
In 2019, John Barrasso, Senator for Wyoming, said “‘Germany seems to be willing to put its head in the noose’, which he thought was a ‘terrible mistake’”, wrote Mr Taibbi. Even the US Ambassador to Germany joined in, writing in Die Welt that, “‘the Nord Stream 2 pipeline will heighten Europe’s susceptibility to Russia's energy blackmail tactics’, chiding ‘some’ Europeans for ‘pushing a self-serving narrative that it is too late to stop Nord Stream 2’.”
As the construction of Nord Stream 2 continued, US rhetoric adopted a more darkly threatening tone. Mr Taibbi notes that in 2020, Mike Pompeo, the US Secretary of State and previously the Director of the CIA, demanded that “Europe must ‘get out now’ from the pipeline project ‘or risk the consequences’.” Meantime, “Republican congressman Adam Kinzinger said [that the US] had to ‘end it, once and for all’, while Ted Cruz [Senator for Texas] stumped for America to use ‘all tools available’ to stop the project”.
In May 2021, Senator Tom Cotton said that new President Joe Biden should “Kill Nord Stream 2 now, and let it rust beneath the waves of the Baltic”. Mr Biden, however, was keen to rebuild relations with Europe after the more abrasive diplomatic style of the Trump Administration, and so the same month he waived the Nord Stream 2 sanctions that had sparked such fury in Europe.
That summer, the US participated in one land and one maritime joint military exercise with Ukraine’s armed forces. In September, President Volodymyr Zelensky met with President Biden in the White House. Only a month later, Washington and Kiev signed an updated version of the US-Ukraine Charter on Strategic Partnership, essentially extending US security guarantees to Ukraine. When Russia responded to this sudden deepening of US-Ukraine ties with a significant military build-up on the border – which the US and British intelligence communities increasingly (and correctly) saw as the prelude to invasion – senior American politicians returned to threatening Nord Stream 2. President Biden himself famously said of Nord Stream that in the event of a Russian invasion, “we will bring an end to it”. Victoria Nuland, the powerful and extraordinarily well-connected Russia hawk who holds the position of Under Secretary of State in the Biden Administration, also warned: “If Russia invades Ukraine, one way or another, Nord Stream 2 will not move forward.” To leave no doubt of US intentions, Jake Sullivan, the National Security Adviser, told CNN in January 2022 that “we have made clear… that pipeline is at risk if they move further into Ukraine”.
One month later, Russia did indeed invade Ukraine, and seven months after that, three of the four Nord Stream pipelines were destroyed. In the next article of this series, we examine the available facts of the sabotage and the media’s reporting of it.
Read more from The Nord Stream Files:
Part two: An explosion of misinformation
Part three: The truth bubbles to the surface
Part four: Why this matters
