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Biden and Merkel reached an agreement to allow completion of the controversial Nord Stream 2 project

The agreement resolved a long-standing dispute over the $11 billion pipeline, which is now 98% complete

Biden and Merkel reached an agreement to allow completion of the controversial Nord Stream 2 project

Washington, July 22 - Neftegaz.RU. Germany and the U.S. have agreed a deal that will allow the Nord Stream 2 project to go ahead without the imposition of further American sanctions, while vowing to punish Russia if it uses the pipeline as a political weapon.

Ukraine fears the pipeline will strengthen Russia’s influence and the country will lose about $3 billion a year in gas transit fees.
Part of the agreement is Germany’s commitment to help Ukraine in negotiating an extension to its current transit agreement with Russia.

Germany has also guaranteed it will reimburse Ukraine for gas transit fees it will lose from being bypassed by Nord Stream 2 until 2024, with a possible 10-year extension.

The statement read:
  • Should Russia attempt to use energy as a weapon or commit further aggressive acts against Ukraine, Germany will take action at the national level and press for effective measures at the European level, including sanctions, to limit Russian export capabilities to Europe in the energy sector, including gas, and/or in other economically relevant sectors
  • This commitment is designed to ensure that Russia will not misuse any pipeline, including Nord Stream 2, to achieve aggressive political ends by using energy as a weapon.
  • The U.S. and Germany are united in their belief that it is in Ukraine’s and Europe’s interest for gas transit via Ukraine to continue beyond 2024
  • In line with this belief, Germany commits to utilize all available leverage to facilitate an extension of up to 10 years to Ukraine’s gas Transit agreement with Russia, including appointing a special envoy to support those negotiations, to begin as soon as possible and no later than September 1
Germany and the U.S. have both committed to supporting a $1 billion Green Fund for Ukraine to diversify its energy source
An initial deposit of $175 million will be contributed by Germany for renewable energy and hydrogen development, accelerating the Ukraine’s transition from coal.

A.Merkel will step down after the September national elections in Germany.
Ukrainian President V.Zelensky will meet with President J.Biden on 30 August to discuss energy issues, as Ukraine fears Russia using energy as a weapon against the country and losing fees as a transit point for gas supplies.

To read the full story in Russian

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