NORD STREAM II: PRAGMATIC SOLUTION
A plan to expand the Nord Stream natural gas pipeline from Russia's Baltic coast to Germany must comply with EU rules, European leaders said on Friday, while Italy urged the European Union to have the courage to block it.
Together with a group of Baltic and east European countries, Italy forced the plan to expand the pipeline, dubbed Nord Stream-2, on to the agenda at Friday's meeting of EU leaders in Brussels.
European Council President Donald Tusk said it would be up to the European Commission to make a final decision on legality, but in his view Nord Stream-2, backed by Gazprom, E.ON , Wintershall, Shell, OMV and Engie , flouted EU rules.
Russia's gas export pipelines have become intensely political because of the conflict in Ukraine, the traditional transit route for shipping Russian gas to the EU.
The EU, which has sanctioned Moscow following its seizure of Ukraine's Crimea region, was expected to extend the sanctions regime on Friday.
"It was a very tough, very emotional debate," Tusk said. "We all agreed any new infrastructure should be fully in line with all the objectives of the EU, such as reducing energy dependency, diversification of suppliers, sources and routes."
The EU's role, he said, was to be objective and avoid such problems being solved bilaterally rather than through discussions involving all 28 EU member states.
Italian Prime Minister Matteo Renzi, who delayed an EU decision on the renewal of sanctions against Russia to ensure Nord Stream was discussed at the summit, said EU leaders had to have the courage to block the expansion.
He said only Germany and the Netherlands had supported it. "Germany and the Netherlands said that it's only a business issue, while for us there is an important political value in the doubling of Nord Stream," Renzi said.
Hungarian Prime Minister Viktor Orban also said a majority opposed Nord Stream and asked why it was different from the already abandoned South Stream project.
Citing EU legal issues, Russia last year said it was cancelling South Stream, that would have delivered gas to southern Europe, bypassing Ukraine.
"South Stream was blocked, and now it needs a reasonable argument at least why South Stream is bad and Nord Stream is acceptable," Orban said.
Gazprom and some utilities say Nord Stream-2 is the most pragmatic solution to shoring up Europe's energy security. The European Commission has said it is assessing its legality.
A senior European Commission official, speaking on condition of anonymity, said investors should see the Commission's decision before pressing on. "Anybody who wants to put in money will be well advised to wait."
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