Nord Stream 1: Canada to return repaired part to Germany

Canada has announced it will return to Germany a repaired turbine of the Russian Nord Stream 1 pipeline, which is a core source of the gas supply to Germany.

It comes as the pipeline prepares to undergo maintenance from July 11 to 21. Although the maintenance is nominally routine, the tension with Russia and the sanctions status in allied countries like Canada had prompted German leaders to consider the possibility of a longer shutdown. 

The repairs come amid Canadian sanctions against Russia extending "to land and pipeline transport and the manufacturing of metals and of transport, computer, electronic and electrical equipment, as well as of machinery."

Ukraine had urged Canada not to return the repaired part, saying it would undermine sanctions against Russia.

The parts were being repaired at the Canadian site of German industrial giant Siemens. Russia's Gazprom had cited the equipment's absence last month as the reason for cutting capacity along the Nord Stream 1 pipeline to 40 %.

But when announcing its decision on Saturday, Canada's Natural Resources Minister Jonathan Wilkinson said it was taken to "support Europe's ability to access reliable and affordable energy as they continue to transition away from Russian oil and gas."

The minister particularly cited concern for the German economy as well as German citizens, saying they could be left unable to heat their homes during winter.

German Chancellor Olaf Scholz was relieved that Canada cleared the way for the delivery of the Siemens turbine for the Nord Stream 1 gas pipeline. "We welcome the decision of our Canadian friends and allies," he said.

Ukraine says returning part 'bowing to Russian blackmail'

Ukraine had been urging Canada not to return the repaired turbine. Alexandra Chyczij, the national president of the Ukrainian Canadian Congress said it would be "setting a dangerous precedent that will lead to the weakening of the sanctions regime imposed on Russia."

Sergiy Makogon, the chief executive officer of Ukraine's gas transmission system OGTSU stressed the turbine must be returned to Ukraine rather than Germany.

The country argued that Germany could rely instead on Ukrainian pipelines to transport a sufficient amount of gas.

Makogan described in a Facebook post the situation as "Kremlin blackmail." Russia's parliament had said the turbine's return would lead to lifting up gas supplies to Europe.

Siemens had proposed the shipping of the turbine back to Germany first, rather than to Russia, as a solution to Canada's legal dilemma. Berlin will then deliver it to Russia's state-controlled Gazprom, Reuters reported, citing a government source.

The Nord Stream 2 pipeline project was famously halted, despite it being completed, soon after Russia's invasion of Ukraine in February. But the original sister pipeline, inaugurated in 2011 and with a similar transport capacity, has remained in operation so far with its deliveries as yet unaffected by European sanctions.

Electricity security called into question

Fears are growing in Germany regarding a difficult winter, should Russia maintain its reduced gas supply.

Peter Adrian, the president of the Association of German Chambers of Commerce and Industry (DIHK), warned that the crisis could take its toll not only on citizens in need of heating their homes, but also on companies and Germany's economy at large.

Adrian told the dpa news agency that this could trigger a serious recession, predicting a decline in economic output of up to 10%.

"The clock is ticking and, as businesses, we have to think about the worst case scenario," Adrian said, warning of "disaster" should Russia fail to turn the gas supply back on after the conclusion of the pipeline's maintenance on July 21.

The German government is working hard to establish alternative floating terminals to receive liquefied natural gas. However, such plans are unlikely to materialize by winter.

rmt/msh (AFP, dpa, Reuters)