EU slams Nord Stream gas link closure as Gazprom doubles down on cause

The EU has slammed the move by Gazprom late Sept. 2 to close the Nord Stream pipeline indefinitely, as the Russian state-controlled company continued Sept. 3 to look to justify the shutdown on technical grounds.

Gazprom said Sept. 2 that Nord Stream would remain closed after an oil leak was detected in the last operational turbine at the Portovaya compressor station during maintenance work.

It suspended flows on Aug. 31 to carry out the work, but said it was not possible to resume supplies -- which had already been running at just 20% of capacity -- as planned on Sept. 3 because it could not repair the leak on site.

"Gazprom's move is sadly no surprise," EU Council President Charles Michel said on Twitter.

"Use of gas as a weapon will not change the resolve of the EU," Michel said. "We will accelerate our path towards energy independence."

European Commission chief spokesperson Eric Mamer said Gazprom was shutting Nord Stream "under fallacious pretenses" and was yet another confirmation of its unreliability as a supplier.

"It's also proof of Russia's cynicism, as it prefers to flare gas instead of honoring contracts," Mamer said on Twitter.

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According to reports, Gazprom has been flaring significant volumes of gas in the area of Portovaya in recent weeks.

Germany's economy ministry said it had "taken note" of Gazprom's statements, adding that Russia's unreliability in recent weeks had prompted Germany to continue measures to strengthen independence from Russian imports.

"As a result, we are now much better equipped than we were a few months ago. As of today, the storage facilities are 84.3% full," the ministry said late Sept. 2.

"The October storage target of 85% is therefore likely to be reached in the first days of September. We are also making good progress with supply via routes other than Russian pipelines and new landing capacities for LNG," it said.

Shutdown cause

Gazprom repeated what it claimed was the reason for the shutdown in another statement on Sept. 3.

On its Telegram channel, it said Siemens engineers had taken part in the maintenance and had signed off on the detection of the oil leak. Gazprom said Siemens was prepared to repair the leak, but that "there is simply no place to carry out the work."

On Sept. 2, Gazprom had said the repair work had to be carried out in a "specialized" repair workshop.

However, Siemens Energy said the oil leak was not a technical reason for stopping operations.

Earlier Sept. 2, Kremlin spokesman Dmitry Peskov said the technical reliability of the pipeline remained under threat due to ongoing maintenance issues at the compressor station.

Moscow has repeatedly blamed Western sanctions for an inability to properly maintain turbines at Portovaya.

"Only one turbine is working. Gazprom is not responsible for the lack of backup," Peskov was quoted as saying by the Tass news agency. "Therefore, the reliability of the entire system is threatened," he said.

Nord Stream had been scheduled to resume operations in the early hours of Sept. 3, and initial nomination data published on the Nord Stream website Sept. 2 suggested flows would return on time.

However, data posted to the website Sept. 3 confirmed that no physical flows were running via Nord Stream.

The move to leave the pipeline closed came after the countries of the G7 said they had agreed a plan to impose a price cap on Russian oil, while EC President Ursula von der Leyen on Sept. 2 also called for a price cap on Russian pipeline gas imports.

Successive reductions in flows via Nord Stream helped push European gas prices to record levels in August.

Platts assessed the Dutch TTF month-ahead price at an all-time high of Eur319.98/MWh on Aug. 26, according to data from S&P Global Commodity Insights.

Alternative routes

Nord Stream had been running at 33 million cu m/d in August, with flows via the pipeline dropping below 1 Bcm for the month, according to data from Platts Analytics.

With the route now closed indefinitely, Russian pipeline gas is coming to Europe via only two routes -- TurkStream and the Ukraine corridor.

Deliveries via the Yamal-Europe pipeline were halted earlier this year after sanctions were imposed by Moscow on the use of the pipeline in Poland and the cancellation by Warsaw of the intergovernmental agreement covering use of the route.

Deliveries via TurkStream totaled 1.21 Bcm in August, surpassing deliveries via both Nord Stream and via Ukraine for the second consecutive month.

Flows via the 15.75 Bcm/year TurkStream string to Europe regularly hit its 43 million cu m/d capacity during August.

Total deliveries via Ukraine remained steady in August, totaling 1.11 Bcm, with flows entering Ukraine only at the Sudzha point and mostly leaving Ukraine at Velke Kapusany on the border with Slovakia.

Ukraine's gas grid operator GTSOU in May declared force majeure on flows entering Ukraine at the Sokhranivka point on the border with Russia.

GTSOU said it no longer had operational control of the Ukrainian compressor station at Novopskov in an area of eastern Ukraine occupied by Russian troops, adding that gas was being taken out of the transit stream for supply to Russian-occupied areas.

Gazprom, however, said it did not see any justification for the declaration of force majeure, and said it saw no reason not to continue supplies as before via Sokhranivka. It also turned down a GTSOU offer to re-route flows via the Sudzha entry point.