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Nord Stream 2 is Losing Chances to Be Built

 

According to Olena Pavlenko, President, Dixi Group Analytical Centre, despite Russia’s urging and lobbying this project by the stakeholders in Germany and the EU, chances that Nord Stream 2 will be built are sinking to zero.

 

“First, even though Russia rejected the Turkish Stream and can focus on Nord Stream 2, it will be impossible to raise money for its implementation, given Russia’s financial standing and commitments undertaken before other partners. The cost of Nord Stream 2 is estimated at the level of USD 10 to 11 billion. However, the financial standing of Russia and Russian companies is very uncertain: the international rating of Russian companies has dropped (Gazprom ranks 43rd), and the Russian Government is cutting domestic spending for 2016 in the context of dwindling reserve fund and other funds. In addition, Russia has commitments related to the construction of the Power of Siberia pipeline to China, the commissioning of which is being delayed and which will be financed in the first place.

 

Second, more and more EU countries understand inexpediency and a political bias behind Nord Stream 2. Last week, governments of ten European countries sent a letter to the European Commission stating that Nord Stream 2 construction does not meet the EU interests. Among them there were countries that were considered to be Russia’s supporters, but now they are changing their stance, including Bulgaria, Greece and Hungary.  That is why it is possible to say that there will be minimum countries lobbying Nord Stream 2 in the EU.

 

Olena Pavlenko
President of DiXi Group

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