German Regulator in Touch with Nord Stream 2 Over Certification Issues

FRANKFURT (Reuters) — Germany's energy regulator said on Friday that it is in touch with the Nord Stream 2 gas pipeline consortium and expects it will provide assurances that the project meets the regulator's requirements.

The regulator also said that it was looking at processing applications by Ukrainian gas company Naftogaz and Ukraine gas grid company GTSOU to participate in the certifying process for the pipeline.

The Nord Stream 2 pipeline is completed and ready to pump Russian gas to Europe, but nothing is flowing yet because it is still awaiting clearance from Germany's energy regulator.

Europe's most controversial energy project, which is led by Russian gas giant Gazprom, has faced resistance from the United States and Ukraine among others.

The German regulator has until early January to certify the pipeline but may make its decision earlier.

"We are in conversations with Nord Stream 2 and expect that the necessary proof will be supplied," the regulator, Bundesnetzagentur, said in a statement.

"At the Bundesnetzagentur we are monitoring compliance with the regulatory demands closely," it added.

Early this month, the German regulator said it had asked the pipeline operator, Swiss-based Nord Stream 2 AG, to show it was meeting all regulatory requirements before the pipeline entered service.

Nord Stream 2 is undergoing a four-month certification process and there is a particular focus on the issues of non-discriminatory network access on German territory and the integration of the interconnector into the German gas market area.

Gas markets are eagerly awaiting news about the pipeline, in a tight market situation with soaring prices as winter approaches.

Russian President Vladimir Putin said on Thursday that Russia can start supplies as soon as Germany gives the green light, which also entails input from the federal economy ministry in Berlin on whether the infrastructure endangers gas supply security.

After Germany’s verdict, the EU Commission also has two months to review that assessment, meaning that certification could drag on.

Polish gas company PGNiG on Thursday submitted a statement warning of increased threats to the security of gas supplies if Nord Stream 2 started operations.

Ukraine, which in 2019 agreed a five-year deal with Russian gas giant Gazprom over gas transit to Europe, complicated by political tensions between the two, has much to lose from Russia being able to bypass Ukraine once Nord Stream 2 is up and running.

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