New Year, Same Old Pipeline Politics

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KleptoCast 9: Natalie Duffy talks to Ilya Zaslavskiy, an energy consultant and research expert at Free Russia Foundation, about how Nord Stream 2 could strengthen the Kremlin’s hand in Europe.

 

By Natalie Duffy

On New Year’s Day, 2017, Gazprom pumped a record amount of gas through its Nord Stream pipeline.

Gazprom CEO Alexei Miller stated that the cubic meters pumped through the pipeline exceeded its capacity, supporting the Russian state-owned energy giant’s longstanding push for a second pipeline: Nord Stream 2.

Nord Stream 2 will stretch from Russia to Germany through the Baltic sea, and is scheduled for commissioning in 2019. If completed, it will bypass Belarus and Ukraine, as well dashing Poland’s desires to develop an autonomous shale gas sector (Gazprom and its affiliates were recently blocked by Poland’s anti-monopoly board).

Unsurprisingly, Nord Stream 2 has faced opposition from Eastern and Western European countries alike, who have argued that the second pipeline will result in “deepening Western Europe’s dependence on Russian gas and strangling Ukraine’s ability to resist [Putin’s] faltering destabilization campaign there.” As the Trump administration threatens to begin withdrawing the U.S. from global affairs, Nord Stream 2 could grant the Kremlin an even stronger strategic advantage in Europe.

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Proposed route of Nord Stream 2.

These pipeline politics, though half a world away, have direct links to our political space here in the United States. In the first half of 2016, Richard Burt received “$365,000 for work he and a colleague did to lobby for a proposed natural-gas pipeline owned by a firm controlled by the Russian government.” Burt had also been enlisted by Trump advisor Paul Manafort to assist in writing a speech that aimed to define Trump’s general foreign policy stance.

The Nord Stream 2 project is just another example of how Russia is involved not just politically, but also financially in issues of strategic importance to the U.S. by way of lobbying. Energy and political risk consultant Ilya Zaslavskiy explained, “Nord Stream 2 is clearly a politically motivated project that aims to undermine European energy security and set Germany as Russia’s energy hub against the rest of the EU.”

Given the Trump administration’s apparent reluctance to resist Russian influence in Europe, it will be important to keep an eye on what role the U.S. lobbyists and advisors who have been involved in the Nord Stream 2 project will play in the new administration, and what it will mean for the fate of this additional Russian entrant into Europe.

Natalie Duffy is a Research Associate at Hudson Institute’s Kleptocracy Initiative. Follow her on Twitter.

Ilya Zaslavskiy is a research expert at Free Russia Foundation and a 2016 Visiting Senior Fellow at Legatum Institute. Follow him on Twitter.