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Nord Stream 2: Poland fines Gazprom billions

October 7, 2020

Poland's anti-trust regulator has ordered Russia's Gazprom to pay an enormous fine over the construction of the Nord Stream 2 pipeline. Warsaw has long been opposing the mammoth project to deliver Russian gas to Germany.

Nord Stream 2 construction site
Image: DW/V. Esipov

Russian energy giant Gazprom pledged to appeal what they described as an "unprecedented" fine after the Polish anti-monopoly watchdog UOKiK ordered them to pay some $7.61 billion (€6,47 billion) over the Nord Stream 2 pipeline.

The Polish regulator said that building the pipeline would increase Gazprom's dominance on the Polish market. The project, which would allow Germany to double its gas imports from Russia, is "tantamount to breaking the rules of law and of fair competition" and the current situation may trigger "serious consequences for Poland's and the EU's economy," they added.

Read more: Nord Stream 2 pipeline — what is the controversy about?

Gazprom is spearheading the Baltic Sea construction effort and is also paying for half of it, while the other half is financed by five Western companies — ENGIE, OMV, Royal Dutch Shell, Uniper and Wintershall. These companies have also been ordered to pay millions in fines.

Following Wednesday's ruling, the Kremlin said it had "no doubt" that Gazprom would do "everything possible and necessary" to legally contest the decision. When asked if the move would harm the relations between Moscow and Warsaw, Vladimir Putin's spokesman Dmitry Peskov said that the ties between the two countries "can hardly be described as flourishing as it is."

Final blow for Nord Stream 2?

Poland is one of the most vocal critics of the project which would allow Russia to deliver the fuel directly to its biggest buyers. The route bypasses central and eastern European countries that usually collect lucrative gas transit fees. Additionally, the pipeline would sharply reduce the countries' bargaining power in the event of a supply row with Russia, which is especially important for Ukraine, as Russia would have an alternative supply route at its disposal. Many in Brussels are also irritated by the German insistence on the project, as EU officials hope to reduce the bloc's energy dependence on Russia. However, Berlin has plowed ahead and defended the upcoming pipeline as a purely business venture, despite some domestic discontent. Former German Chancellor Gerhard Schröder, known for his ties to the Kremlin and Gazprom, also serves as the chairman of the pipeline project.

Infografik Karte Gaspipelines Europa Nord Stream EN

On top of criticism from within Europe, the US is also opposing the project and trying to instead pressure EU buyers into purchasing gas from US companies. In December last year, Trump signed a bill to sanction the companies involved in the Nord Stream 2 construction. With the 1,230-kilometer (764-mile) pipeline nearly complete, the work was stopped due to the threat of the US sanctions.

The recent poisoning of Russian opposition leader Alexei Navalny has dialed up the pressure on Germany to permanently give up on the project.

Germany reconsiders Nord Stream 2 pipeline

dj/msh (Reuters, AP, Interfax, AFP)