Denmark and Nord Stream 2

Nord Stream 2 is a 1,234-kilometre long natural gas pipeline that runs from Russia to Germany through the exclusive economic zones of Finland,[1] Sweden,[2] and Denmark.[3] It is mainly financed by the Russian company Gazprom, as well as multiple European energy companies. The initial plan, however, was for the pipeline to run through Danish territorial sea, but after stalling the application for almost two years, the company behind Nord Stream 2 withdrew their application and instead applied to run the pipeline through the Danish exclusive economic zone, whereby only an environmental permit was necessary. The reluctance to accept the application was that the overseas pipeline had become a geopolitical matter, in which Denmark's closest allies had conflicting interests. This placed Denmark in a difficult position regarding whether or not to accept the proposal.[4]

Background

Nord Stream 2 is an economic and commercial project, intendent to accommodate the growing shortage of natural gas within Europe, in particularly Germany, with both Russia and Germany in favour for the project.[5] However, after the Russian annexation of Crimea in 2014, Europe's reliance on Russia for gas became a geopolitical concern, complicating the build of Nord Stream 2.[5] While Russia and Germany continued to defend Nord Stream 2, citing it as a commercial venture that should not be politicized,[5] the U.S argued inherently against the pipeline, stating that it constituted a security and defence threat.[6] The U.S claimed that the overseas gas pipelines would increase European dependency on Russia, pointing to so-called "energy blackmail" as an imminent threat,[7] and even went as far to sanction companies that assisted with the completion of the pipeline.[4] The U.S had however also some economic interest at play, namely the sale of liquefied natural gas (LNG) to Europe.[7] Baltic countries such as Poland and Ukraine were also against the approval of the pipeline,[7] having previously experienced Russian "energy blackmail".[8]

Reason for debate

Despite Denmark not needing any natural gas, it became the centre of the geopolitical conflict when the company behind Nord Stream II in April 2017, in accordance with the UN Convention on the Law of the Sea, applied for permission to build transit pipelines in Danish territorial sea, namely the waters south of Bornholm.[7] The gas pipes would also pass through Finland and Sweden, but unlike Denmark, it was only through the respective countries’ exclusive economic zones, where it in Denmark's case was about territorial sea.[7] This difference meant that Sweden and Finland only had to prepare environmental assessments and the accompanying permits, while Denmark, on the other hand, had the possibility to deny the route.[7]

While the U.S is Denmark's most significant security ally,[7] its second largest investor and third largest export market,[5] Germany is arguably the most important EU partner for Denmark.[7] This led to the issue of Nord Stream II to be viewed by some experts as the "most important decision in Danish foreign policy after the Cold War",[7] as it was about how Denmark would position itself in relation to Germany, American and Russian interests.[7] The voices of prominent Danish experts were however divided – some argued that Danish government should allow the Nord Stream II to go through Danish territorial sea,[7] while others warned strongly against it.[4]

Danish political parties' views

Although the Danish Government had permitted an almost identical pipeline in 2009, Nord Stream I,[9] it was in a different and difficult predicament regarding Nord Stream II. The situation and attitude towards the Nord Stream pipelines had changes after the 2014 annexation of Crim, and Denmark's allies had conflicting interest.[4]  While the opposition, including Social Demokratiet and Radikale Venstre, wanted the construction of Nord Stream II prevented as they considered it a problematic security matter,[10] the supporting party of the government, Dansk Folkeparti, held a different view. They found the matter of Nord Stream II to be a "simple trade agreement". The parti strongly criticized the way in which the matter had become subject to "geopolitical games".[11] The government at the time, consisting of Venstre, Liberal Alliance og Det Konservative Folkeparti, did not comment directly on the matter but was nevertheless behind a bill that would make it possible to include foreign, security and defense considerations in the assessment of applications regarding infrastructure projects in Danish maritime territory.[12] The bill, led to an amendment of the Continental Shelf Act, which came to force on January the 1st 2018.[5] The amendment gave the Danish Ministry of Foreign Affairs the right to include foreign, security and defense policy considerations in the assessment of applications pertaining to projects in the Danish territory sea. The amendment was also applicable to North Stream II as it was retroactive in its effects.[5]

Applications from Nord Stream

On the 3rd of April 2017, the Danish Energy Agency (DEA) received an application from the Nord Stream II company regarding permission to build transit pipelines in Danish territorial sea.[13] Denmark was however slow to respond due to geopolitical implications of the decision, and the amendment of the Continental Shelf Act made it possible to shift the matter from the DEA to Danish Ministry of Foreign Affairs.[5] They Danish government also sought to shift the decision of the pipeline to the EU, but without any success.[7] The Nord Stream II Company sent yet another application on the 10th of August 2018, in which it requested permission to build the pipeline through an alternative route north of Bornholm,[14] as well as a third application on the 15th of April 2019, at the request of the DEA, which contained two further proposals for routes on the continental shelf southeast of Bornholm.[15] The DEA stated in connection with the third application that the first application from 2017 was still being assessed by the Foreign Minister, and while it was advancing it was not yet completed.[15] The application from 2018 was also advancing, as it had been through the public Espoo hearing, but the permit would now await assessment of the new South-Eastern routes from the 2019 application.[15]

Permit for a southeast route

On the 28th of June 2019, the Nord Stream II company withdrew their first application from the 3rd of April 2017,[16] in which they were seeking permission to build transit pipelines in Danish territorial waters, leaving only the two applications from 2018 and 2019 left. These two applications were concerning routes that went through the Danish EEZ, but not Danish territorial sea, whereby only an environmental assessment and permit would be necessary. Matthias Waring, the director of Nord Stream II, stated that they had felt compelled to withdraw their application as there had been no indication that the Danish government was near a decision.[17] On the 30th of October 2019, the DEA granted Nord Stream II a permit for the construction of natural gas pipelines on the Danish continental shelf southeast of Bornholm, hereby accepting one of the routes from the third application from the 28th of January 2019.[18] Referring to the UN Convention on the Law of the Sea, DEA stated in a press release that Denmark was obliged to allow the construction of the transit pipelines with respect to the environment and recourses, and a permit was therefor released in pursuant to the Continental Shelf Act.[18]

Through what has been described as a "cunning" act by the Danish media, the Danish Energy Agency and the Ministry of Foreign Affairs succeeded in dragging out the Danish approval of the pipeline for so long that the Nord Stream II company formally withdrew their application for the initial route,[6] whereby the decision was no longer one of the Danish government, but instead a question of international law.[5] The Danish government managed to balance the interests of Denmark, without actually making a decision regarding the application of the initial route, and thereby managed to avoid directly opposing any of the conflicting interests of its allies[6]

References

  1. "Permitting Process in Finland". Nord Stream 2. Retrieved 22 December 2019.
  2. "Permitting Process in Sweden". Nord Stream 2. Retrieved 22 December 2019.
  3. "Denmark gives go-ahead for Nord Stream 2 Russian pipeline segment". DW. 30 October 2019. Retrieved 22 December 2019.
  4. "Magtkampen under Østersøen | DIIS". www.diis.dk (in Danish). 2021-01-11. Retrieved 2023-05-27.
  5. Wood, Steven; Henke, Otto (2019). "Denmark and Nord Stream 2: A small state's role in global energy politics". Energy Policy. 148: 1–13 via Elsevier.
  6. Mencke, Mathias Sonne. "Nord Stream 2 er historien om Danmarks umulige balancegang mellem stormagter, der ser ud til at lykkes". Informationen.
  7. "Danmark og spillet om Nord Stream 2 | DIIS". www.diis.dk (in Danish). 2019-02-07. Retrieved 2023-05-27.
  8. "TEPSA Brief: "Facing the Double Crisis: Geopolitics and Climate Change put a Strain on the Baltic Sea Region Energy Security", Trine Villumsen Berling & Izabela Surwillo (DIIS, Denmark) – TEPSA". 2022-05-10. Retrieved 2023-05-27.
  9. "Pressemøde den 28. april 2010". Statsministeriet (in Danish). Retrieved 2023-05-27.
  10. "Oppositionen til regeringen: Sig nej til russisk gasledning". Jyllands-Posten (in Danish). 2017-10-18. Retrieved 2023-05-27.
  11. "Søren Espersen kalder Danmark 'en kryster' i sag om russisk gasledning". DR (in Danish). 2019-06-29. Retrieved 2023-05-27.
  12. Lovforslag L43: Forslag til Lov om ændring af lov om kontinentalsoklen (Tilladelse til visse rørledningsanlæg på søterritoriet) Fremsat den 4. oktober 2017 af energi-, forsynings-, og klimaministeren (Lars Christian Lilleholt) https://www.ft.dk/ripdf/samling/20171/lovforslag/l43/20171_l43_som_fremsat.pdf?__cf_chl_tk=zFgXMTzHLY3h1u5iEUbGbZzsXbTJ2cVh7AOt9RwoNtU-1685199754-0-gaNycGzNDWU
  13. "Nord Stream 2 ansøgning er modtaget". Energistyrelsen (in Danish). 2022-05-02. Retrieved 2023-05-27.
  14. "Ny Nord Stream 2 ansøgning modtaget". Energistyrelsen (in Danish). 2022-05-02. Retrieved 2023-05-27.
  15. "New Nord Stream 2 application for two southern route options". Energistyrelsen. 2022-05-02. Retrieved 2023-05-27.
  16. "Nord Stream 2 AG trækker ansøgning tilbage for rute på dansk søterritorium". Energistyrelsen (in Danish). 2022-05-02. Retrieved 2023-05-27.
  17. Mogensen, Lars Trier. "Jeppe Kofod fik en uventet tiltrædelsesgave, da Nord Stream 2 trak sin ansøgning tilbage". Information.
  18. "Permit for the Nord Stream 2 project is granted by the Danish Energy Agency". Energistyrelsen. 2022-05-02. Retrieved 2023-05-27.
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