Nord Stream as a reason for war

Nord Stream as a reason for war
by Florian Warweg
[This article posted on 4/16/2023 is translated from the German on the Internet, Nord Stream als Kriegsgrund.]
https://www.nachdenkseiten.de/?p=96339

The blue-yellow flag stands for freedom, the ominous Russian sign "Z" for oppression. But the war over Ukraine cannot be explained that simply, although among European state chancelleries and leading media only this one narrative has taken root. The anthology "Kriegsfolgen - Wie der Kampf um die Ukraine die Welt verändert" ("Consequences of War - How the Battle for Ukraine is Changing the World"), published in early April 2023 by the Vienna-based ProMedia publishing house, claims to shed light on the motives and consequences of this world crisis, the most dangerous for generations, in 17 contributions by Ukrainian, Russian and German-language authors, beyond propaganda narratives. The NachDenkSeiten present the contribution of our editor Florian Warweg for the "War Consequences" volume, in which he devotes himself to the economic background of the Nord Stream blow-up. By Florian Warweg.

In the early morning hours of September 26, 2022, at 02:03 Central European Time, seismological institutes in Denmark, Sweden and Norway recorded tremors twelve nautical miles southwest of the Danish island of Bornholm that corresponded to those of a mild seaquake with a magnitude of 2.2 to 2.3 on the Richter scale. Shortly afterwards, a massive loss of pressure was detected in string A of the Nord Stream 2 pipeline at a depth of 70 meters. On the German side, the pressure dropped abruptly from 105 to about 7 bars. Almost exactly 17 hours later, at 7:04 p.m., severe tremors of identical strength were again recorded, this time northeast of Bornholm, followed by pressure loss in both strings of the Nord Stream 1 Baltic Sea pipeline, which has been in operation since 2011, at a depth of 88 meters.[1]

In response to the first recorded explosion (a natural quake had already been ruled out as the cause at this point), the Danish military dispatched F-16 fighter jets from Bornholm to photograph the affected area, according to its own account. The fighter jets are said to have first detected the large-scale methane bubbles rising from the water around midday. Around eight hours later, at 8:41 p.m., the Swedish Maritime Authority then issued a warning of further gas leaks after several ships reported carpets of bubbles also northeast of Bornholm. As a result, the Danish and Swedish maritime authorities imposed so-called nautical warnings within five nautical miles of the leaks. Air traffic below 1000 meters altitude was also prohibited in the area.[2]


"Targeted attack by a state actor."

Further investigation revealed that there were four leaks in total, two involving the Nord Stream 1 pipeline, which had been destroyed over a length of 250 meters, and two involving string A of the Nord Stream 2 pipeline. An accident is considered to be ruled out; both NATO states and Russia assume a "targeted act of sabotage." Russian head of government Vladimir Putin called the events "international terrorism." In a joint letter dated September 29, 2022, to the United Nations Security Council, Sweden and Denmark spoke of using "an explosive charge of several hundred kilograms of TNT equivalent" - per leak, mind you. On October 7, 2022, in response to a parliamentary question, the German government stated that "against the background of the complexity of the execution of the crime," it assumed a "state actor" as the perpetrator.[3] All four leaks are located, again an interesting detail, just outside territorial waters in the exclusive economic zones of Denmark and Sweden, which are considered international waters under international law. This means that whoever carried out the attacks was meticulous in making sure that these four explosions occurred in international territory. An attack within national territorial waters would have had even more far-reaching implications under international law.

One of the most expensive energy infrastructure projects of all time

The suspected attack by a state actor targeted one of Europe's most expensive and largest energy infrastructure projects. The construction of Nord Stream 1 alone cost 7.4 billion euros, while the more recent Nord Stream 2 pipeline brother cost 10 billion. Both pipelines, each with two strings, stretch over 1224 kilometers. In the case of Nord Stream 1, around half of the construction investment (51 percent) was borne by the Russian natural gas company Gazprom and 24.5 percent each by the two German companies BASF (Wintershall) and E.ON (Ruhrgas). Nord Stream 1, at least, is thus considered a purely Russian-German project.[4]

In the case of Nord Stream 2, the shareholdings were somewhat more widely spread; here, in addition to the aforementioned groups, the Dutch-British Shell, the French Engie Group, and the Austrian gas group OMV were also involved, albeit with fewer shares. All of the aforementioned Western European groups have lost at least one billion euros each as a result of the end of Nord Stream, according to their own statements.[5]

With a transport capacity of up to 110 billion cubic meters of natural gas annually, the four strands of Nord Stream 1 and 2 alone would have been sufficient to secure Germany's entire natural gas consumption as an industrial nation. In 2021, Germany's total natural gas consumption was 90.5 billion cubic meters.

The importance of the Baltic Sea pipeline for Germany

When Nord Stream 1 became fully operational in October 2012, the Federal Republic of Germany already became a central transit country for the European gas trade. Since Germany also provided the two dominant private energy suppliers in Europe at the time, E.ON and BASF subsidiary Wintershall, Nord Stream 1 put the country in a position to exercise market power control over the security of supply of other European countries and the UK in particular. This, especially since it was a purely German-Russian project, led to strong disgruntlement, particularly in U.S. political and business circles. These were to intensify again with the planning and construction of Nord Stream 2. A September 2005 working paper by the government-affiliated think tank Stiftung Wissenschaft und Politik (SWP) openly explains how, with the help of the then chairman of the Committee on Eastern European Economic Relations (Ostausschuss der Deutschen Wirtschaft), Klaus Mangold, foreign competition for Nord Stream 1 was gradually eliminated.[6] The German government's decision to build the Nord Stream 2 pipeline was based on the assumption that the German-Russian project would be completed by the end of 2005.

Previously, it should be recalled in the current hysteria, Gazprom had held talks with BP, Royal Dutch/Shell, Gasunie, Gaz de France, and Norsk Hydro, in addition to E.ON and Wintershall. Gazprom also negotiated directly with the Dutch government in 2002 to realize the project. London's interest was expressed in a corresponding natural gas moratorium on cooperation, which was signed in June 2003 by then British Prime Minister Tony Blair and Russian President Putin. In other words, it was primarily German companies and the German government at the time that had a purely Russian-German pipeline project in mind, not the Russian side.

Displeasure with the situation on the U.S. side had even broader reasons. While the U.S. had virtually ended its energy dialogue with Russia and cut back on investments in the wake of the so-called Yukos affair (the breakup of the Yukos corporation and the imprisonment of its owner, oligarch Mikhail Khodorkovsky) and the dispute over the war in Iraq, German corporations were gaining strategic advantages over their U.S. competitors in the Russian market. [7] German companies thus gained both a privileged position in the rapidly growing Russian market and competitive advantages through access to cheap energy sources via the long-term, privileged and mutually lucrative cooperation in the gas and oil business. This manifested itself on September 7, 2005, ten days before the German parliamentary elections, with the signing of the contract for the construction of the Baltic Sea pipeline, which for the first time was to provide a gas connection between Russia and Germany without the possibility of direct intervention from the previous transit countries, such as Poland and Ukraine, which had strong ties to the USA.

The importance of Nord Stream for Russia

The advantages of the Baltic Sea pipeline project for Russia are obvious. With Nord Stream, the world's largest and majority state-owned natural gas company Gazprom had for the first time a direct and undisturbed connection to the Western European and, in particular, German sales market. By eliminating transit fees for land pipelines, Russia solved two problems at once: First, transit fees significantly reduce profits; second, transit countries can use them as a political and economic weapon against Russia, as regularly practiced by Ukraine and Poland in particular. Likewise, one prevents illegal gratuitous extraction of gas, a problem often complained about by Gazprom when transferring through Ukraine. Nord Stream allowed Russia to become less dependent on existing land-based pipeline routes and subsequently to have a greater variety of transport routes to Western Europe, a classic approach to diversification. This diversification maxim, which is often forgotten today, was initially also followed by the EU, which in the early 2000s still unreservedly supported the construction of the Baltic Sea pipeline.[8]


Nord Stream stands in the way of vital US interests

Just a few years ago, the U.S. LNG industry was in a catastrophic mood. The fracking boom in the late 2010s had created a massive oversupply of natural gas. From the beginning of the 2020s, for example, the spot market price at the US hub Henry Hub was just under five euros per megawatt hour. The U.S. fracking industry, which had been endowed with many billions of OnU.S. dollars by the financial sector, and, as a logical consequence, significant parts of the U.S. financial system, were on the verge of bankruptcy in the face of this price development.[9] This was because, as is usual in big business in the U.S., the investments had been made with little equity and a lot of debt capital. To prevent the impending collapse, there was really only one option: expansion into the EU market and, in particular, into the largest importer of natural gas by far, with an annual demand of about 100 billion cubic meters: the Federal Republic of Germany.[10] But what interest should Germany and its industrial sector have in importing U.S. LNG gas, which (before the start of the war and sanctions) was 7 times more expensive than the Russian natural gas flowing into the country via pipeline? On a voluntary and rational decision-making basis, first of all none at all.

As Jens Berger, a journalist specializing in energy issues, among others, points out, it is only since the escalation of the Ukraine war and the associated EU sanctions against Russia that the price of fracked gas has reached a level that allows U.S. energy companies to earn money and not - as in previous years - lose massive amounts of money.

But even this development was still on a less than sustainable economic footing until the summer of 2022. Only the blowing up of the Nord Stream pipelines ultimately cleared the way for the EU, and Germany in particular, to become long-term buyers of U.S. natural gas surpluses and to keep the price at a profitable level for U.S. fracked gas producers, even in the long term. The associated new natural gas dependency of their EU "partner" undoubtedly also fits into the U.S. global strategic dominance concept. According to a study by the Energy Economics Institute at the University of Cologne (EWI), the U.S. will soon not only replace Russia as the most important energy supplier, but will then assume the same dominant role for the EU gas market as Russia did before the Ukraine war, with an anticipated import volume of around 40 percent.[11] So much for the alleged "reduction" of the EU's energy dependency, which is supposedly so close to Washington's heart.

Against this backdrop, much points to U.S. perpetration. The renowned U.S. investigative journalist Seymour Hersh, who among other things exposed the U.S. Army's My Lai massacre in Vietnam, published a sensational article on February 8, 2023, entitled "How America Shut Down the Nord Stream Pipeline." Citing a whistleblower, it detailed how the U.S. and Norway carried out the blowing up of the Nord Stream pipelines.[12] As expected, the U.S. foreign intelligence agency, the CIA, denied the allegation, stating, "This claim is completely and utterly false."

Whether or not the U.S. claims responsibility for blowing up Nord Stream, it is demonstrably the largest economic beneficiary of the act. Against this backdrop, U.S. Secretary of State Anthony Blinken's remark a few days after the attack takes on an entirely different relevance. Blinken had unapologetically declared the destruction of the Nord Stream pipelines a "tremendous strategic opportunity" for the U.S. at a press conference on September 30, 2022, during the visit of his Canadian counterpart Mélanie Joly.[13] Blinken said.

"We are now the leading supplier of liquefied natural gas to Europe [...]. This is also a tremendous opportunity. It is a tremendous opportunity to eliminate dependence on Russian energy once and for all, thereby depriving Vladimir Putin of the opportunity to use energy as a weapon and a means to enforce his imperial plans. This is very significant and presents a tremendous strategic opportunity for years to come."
What the "enormous strategic opportunity" for the U.S. consists of has, after all, already been stated.

Poland as eternal opponent of the pipeline

The decision to build Nord Stream 1 came at the beginning of the Polish election campaign in 2005 and was used accordingly, especially by the right-wing conservative Law and Justice Party (PiS). The ruling Catholic-National camp literally called the German-Russian pipeline project an "existential threat." In this context, the Kaczyński brothers spoke of a "Schröder-Putin pact," in direct allusion to the 1939 "Ribbentrop-Molotov pact."[14]

In fact, the Polish rejection of the entire Nord Stream project was probably determined less by security policy considerations than by tangible financial interests - borne by the concern that the Baltic Sea pipeline would cause Warsaw to lose the millions in transit fees it received from Moscow year after year. After all, Warsaw only wants to become more independent of gas imports for its own consumption. When it comes to transit, Poland is very much interested in the highest possible gas volumes, because these generate the corresponding fee income. This also explains why Poland did everything in its power to prevent the Baltic Sea pipeline, but at the same time strongly supported the expansion of the Yamal I pipeline, which is fed with Russian gas, with a second line, which would of course run through Poland.

On the other hand, and probably even more relevant, are the plans that have been nurtured in Warsaw for years and have already been implemented in part, as the taz, for example, states in an article from the beginning of February 2022, to "roll up the Central European gas market anew together with the USA and to take over the previous transfer business from Germany". [15] To this end, Poland bought extensive gas production fields in Norway years ago, had the "Baltic Pipe" built through the Baltic Sea, and built gigantic gas cisterns on the Baltic Sea coast for the conversion of US LNG, which is then to be exported. These immense investments in gas infrastructure, which Poland has been making for years with explicit U.S. support, actually only had economic prospects of success from the very beginning, if Nord Stream 2 does not get off the ground. And this project could only really yield a profit if Nord Stream 1 were also no longer in operation.

Significantly, representatives of the governments of Poland, Denmark and Norway opened the Baltic Pipe, which was explicitly designed as an alternative pipeline to Russian gas, on September 27, 2022, just one day after the sabotage of Nord Stream. On the occasion of the inauguration, Polish Prime Minister Mateusz Morawiecki said: "This gas pipeline means the end of the era of dependence on Russian gas. It is also a gas pipeline of security, sovereignty and freedom not only for Poland, but also for many others in the future." [16]
This probably reveals the core of the massive Polish opposition to the Nord Stream project.

Conclusion

While the German and Russian business and political communities had an understandable interest in strengthening their energy partnership from the early 2000s and, with Nord Stream, having a pipeline that would make them independent of unreliable transfer countries with their own agendas, the situation is exactly the reverse, especially in the case of the United States and Poland. Both Washington and Warsaw have been wary of increasing cooperation between Berlin and Moscow for decades and are doing everything they can to prevent it.

When threats did not help in the past, violence was resorted to. One need only recall the explosion of the Soviet Chelyabinsk pipeline in the summer of 1982 due to a CIA operation with manipulated software. This messed up the settings of pumps, turbines and valves of the gas supply in such a way that the pipeline exploded. The explosion is said to have had an explosive force of four kilotons.[17] Before that, starting in February 1982, the U.S. had massively threatened the Federal Republic of Germany with consequences if the industrial agreement concluded with the Soviet Union in November 1981 on the construction of pipelines and the supply of Siberian natural gas with a total annual volume of 16 billion marks was not terminated. In contrast to today, then-Chancellor Helmut Schmidt refused to be intimidated and said to the U.S.: "No matter how much others squawk, the deal is still on." Also revealing was the U.S. Congress's justification at the time for its displeasure with the deal: "Our businessmen will be out of the Eastern market." [18]

And this brings us back to one of the key outcomes of the destruction of Nord Stream and the sanctions regime against Russia. It is striking that both the whole business model for the US fracked gas and the extensive investments made on the Polish side in the course of the last few years in LNG infrastructure with the aim of further export only made economic sense if the relevant actors assumed at the planning stage that one would be able to win over the German as well as the wider EU gas market in a timely manner. However, this goal could only be achieved if Washington and Warsaw succeeded in squeezing Russia out of this market as a central and established exporter. What was recently considered a U.S. and Polish pipe dream in the eyes of many experts has become a fait accompli after the events of February 24 and September 26, 2022.

Excerpt from the anthology "Kriegsfolgen - Wie der Kampf um die Ukraine die Welt verändert", edited by Hannes Hofbauer and Stefan Kraft, Promedia-Verlag, Vienna.
Who perpetrated Nord Stream attack? German government still stonewalling, citing "secrecy interest"

Fact check by "Faktenchecker": What manipulative methods ZDF uses to defend the USA in the Nord Stream sabotage case


["1] SVT Nyheter: Seismolog: Två explosioner intill Nord Stream, September 28, 2022, svt.se/nyheter/inrikes/svt-avslojar-tva-explosioner-intill-nord-stream

["2] Neue Zürcher Zeitung: Explosions at pipelines: The saboteurs probably blew up the pipes from the outside, Dec. 2, 2022, nzz.ch/economy/pipeline-project-north-stream-2-the-latest-developments-ld.1483495

["3] German Bundestag, printed matter 20/3513

["4] Detlef Bimboes: Natural Gas from the East and the New Cold War, in: AG-Friedensforschung, April 2, 2006, ag-friedensforschung.de/themes/oel/bimboes.html

["5] Eva Brendel: So viel kostet die Energiekonzerne Nord Stream 2, in: Finance, April 14, 2022, finance-magazin.de/transformation/ukraine-krieg/so-viele-kostete-die-energiekonzerne-nord-stream-2-116661/

["6] Roland Götz: Die Ostseegaspipeline, SWP-Aktuell 41, p. 2, Berlin September 2005.

["7] Alexander Rahr: Berlin - Moscow 2005-2008, in: CISbarometer No. 39, p. 1, Berlin 2005.

["8] EU Commission: Green Paper - Towards a European Strategy for the Security of Energy Supply, p. 42, European Communities, Luxembourg 2001.

["9] Michael Mazengarb: Climate friend or carbon bomb? Global gas market faces $1.3trn stranded asset risk, in Renew Economy, July 3, 2019, reneweconomy.com.au/climate-friend-or-carbon-bomb-global-gas-market-faces-1-3trn-stranded-asset-risk-80593/

["10] Jens Berger 2022: The U.S. has won the gas war against Russia, November 9, 2022.

["11] EWI STUDY 2022: Developments in Global Gas Markets to 2030. Scenario Consideration of Restricted Trade with Russia, ewi.uni-koeln.de/cms/wp-content/uploads/2022/09/EWI_Final_Report_Future_Gas_Global_GasMarkets_2022-09-21.pdf

["12] Seymour Hersch: How America Took Out The Nord Stream Pipeline, in: seymourhersh.substack.com/p/how-america-took-out-the-nord-stream, February 8, 2023.

["13] U. S. Department of State, September 30, 2022, state.gov/secretary-antony-j-blinken-and-canadian-foreign-minister-melanie-joly-at-a-joint-press-availability/

["14] Helmut Fehr: The Abuse of the Past - Political Campaigns and Power Strategies of the National Populists in Poland, in: Frankfurter Rundschau, p. 5, November 22, 2005.

["15] Gabrielle Lesser: Poland hopes for business with gas, in: taz, February 2, 2022.

["16] Wprost: Morawiecki o wybuchach w Nord Stream w dniu otwarcia Baltic Pipe: Bardzo dziwny zbieg okoliczności, September 27, 2022: biznes.wprost.pl/gospodarka/infrastruktura/10878148/morawiecki-o-wybuchach-w-nord-stream-w-dniu-otwarcia-baltic-pipe-bardzo-dziwny-zbieg-okolicznosci.html.

["17] Peter Welchering: Hacken im Kalten Krieg - Von den Anfängen des Cyberwars, in: DLF, February 13, 2019, deutschlandfunkkultur.de/hacken-im-kalten-krieg-von-den-anfaengen-des-cyberwars-100.html.

["18] Werner Meyer-Larsen: Der unverziehene Strang nach Osten, in: Spiegel, March 21, 1982, spiegel.de/economy/der-unverziehene-strang-nach-osten-a-7e646f14-0002-0001-0000-000014337181