The Nord Stream 2 gas pipeline project may be suspended or even completely scaled down due to political pressure. This is stated in the prospectus of Gazprom’s Eurobonds, which was reviewed by Reuters.
The company first spoke about the failure of the landmark gas pipeline, although it still intends to complete its construction “as soon as reasonably possible.”
Since Gazprom is a public company, it is obliged to warn investors about possible risks before placing debt securities. This is exactly what the document says, which at the same time contains a clause about exceptional circumstances under which the project will be stopped.
If they come, then, as the Russian gas monopoly admitted, it may be required to pay compensations – fines, cancellation fees and other payments. There may also be a need to build substantial reserves to contain investment depreciation.
The construction of the gas pipeline stopped in December 2019 due to sanctions from the United States. Since then, only 2.6 kilometers have been able to continue offshore Germany. Since January 15, Denmark has allowed the completion of the Nord Stream-2 barge for the Fortuna barge, but neither she nor the Akademik Chersky pipelayer has yet begun work. In addition, the United States is preparing sanctions against the Russian barge.
The project operator, Nord Stream 2 AG, is at a loss to name the construction start date. A company spokesman explained that a couple more weeks or more are needed for additional testing.
In December 2018, the head of Gazprom, Alexei Miller, argued that Nord Stream 2 will start working in early 2020, and the United States will not be able to prevent it. A year ago, the launch was postponed to the end of 2020 or the beginning of 2021. We are currently talking about mid-2021.