Ukraine crisis prompts Gazprom to shelve Nord Stream pipeline expansion
By LADKA BAUEROVA and ELENA MAZNEVA
Bloomberg
Russia’s OAO Gazprom shelved a project to expand the Nord Stream pipeline, bypassing Ukraine, as relations with the European Union continue to deteriorate.
“There are no plans to expand Nord Stream for now,” and the link has sufficient capacity, spokesman Sergei Kupriyanov said.
The company said in 2012 it would consider building two additional Nord Stream links and connecting the network to the UK.
The decision comes less than two months after President Vladimir Putin canceled the South Stream project to connect Russia and the EU directly and announced an alternative route, via Turkey.
It underscores mounting tensions with Europe, which blames Putin for annexing Crimea and backing separatists in eastern Ukraine.
Both Nord Stream and South Stream were designed by Gazprom to bypass Ukraine, whose Soviet-era network of pipelines transited about 40% of Russia’s gas supplies to Europe last year.
The region suffered shortages in 2006 and 2009 after Russia cut off supplies to its former satellite because of price disputes and Ukraine’s unpaid debt.
The 1,224-kilometer (760-mile) offshore Nord Stream pipeline to Germany started delivering fuel in 2011. When it was completed, the cost was 7.4 billion euros ($8.4 billion).
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