Russia aims to reach Europe’s gas market through Nord Stream pipeline (Representational image)
Russia may be looking to turn the gas taps to Europe back on, with talks under way over bringing a US investor into the Nord Stream pipelines that once carried Russian gas to Germany.According to five people familiar with the matter, the discussions involve US Special Envoy Jared Kushner and Kirill Dmitriev, a close adviser to Russian President Vladimir Putin.Kushner, who has been trying to broker a truce between Russia and Ukraine, sees business deals as central to restoring peace. A potential Nord Stream deal could allow US investors to profit from energy flows to Europe once the war ends.
Nord Stream back on the table
Kushner and Dmitriev have met in Moscow and New York in recent weeks. Two sources told Reuters that Nord Stream remains on the agenda, although not much details are available about the discussions.Dmitriev, who has been pushing for Russian gas sales to Germany to resume, met representatives of the US energy and treasury departments last month, to discuss potential US-Russia energy initiatives.A White House official said that any deals would have to be negotiated with the US International Development Finance Corporation (DFC) and Treasury and must benefit US taxpayers and companies.“Any deals will have to be negotiated by Russia with DFC (US International Development Finance Corporation) and Treasury and must benefit United States taxpayers and companies,” the official said.The official also said there had been “no Nord Stream discussions recently”.
Restarting gas flows won’t be easy
A return of Russian gas to Germany still faces several hurdles. The Nord Stream pipelines are sanctioned by the US and the EU, making any restart illegal.A US official said a deal was unlikely in the medium term because of the obstacles involved. US President Donald Trump could waive or soften US sanctions, but that would become harder if Democrats win control of Congress in next month’s midterm elections.Germany and other European countries are also expected to oppose reopening Nord Stream. They are spending billions of euros rebuilding their military to defend themselves from Russia.A spokeswoman for Germany’s economy and energy ministry said Nord Stream and Russian gas were sanctioned in Europe and that Germany had found alternatives. She said reopening the pipelines would require government approval and was not desired.Before Russia’s invasion of Ukraine in February 2022, Germany bought more than half of its gas from Russia through the two Nord Stream pipelines. They were mothballed after Moscow throttled supplies to Europe and were blown up in a series of underwater explosions in September 2022.
Germany split over Russian gas
The idea of bringing Russian gas back to Germany has also divided opinion within the country.Germany’s coalition government is opposed to restarting the pipeline, while Alternative for Germany (AfD), the country’s most popular political party, wants to reopen it. Dmitriev is due to meet AfD leadership early next year to discuss selling Russian gas again.Poland is also watching the discussions but remains firmly opposed to reopening the pipeline, according to one person familiar with the government’s thinking. Poland and the Baltic states are particularly vulnerable to Russia and reject energy ties.The talks are taking place against a backdrop of deep European mistrust of Russia’s motives. Earlier this year, the heads of five European spy agencies told Reuters that Russia did not want to end the war quickly and was using US talks to push for business deals instead.Relations between Russia and Germany, which is among the biggest providers of military support to Ukraine, have hit a low ebb. Officials in Berlin have accused Russia of mounting a systematic campaign of hybrid attacks.Some German lawmakers say business deals would bolster Moscow as it pursues war with Ukraine.“This threatens to be a dirty deal that will cost Europe dearly,” said Michael Kellner, a lawmaker who was in charge of German energy policy in the aftermath of the Ukraine invasion.“Americans and Russians will share the profits,” he said.
Who owns Nord Stream?
Ownership could be another hurdle for any US investment in Nord Stream.Russian state energy giant Gazprom owns 51% of the company. Another 31% is split between two German entities, while the remaining stake is held by a French and a Dutch firm.The two German shareholders want to retain their stakes to maintain German influence if Gazprom sells its share, another person familiar with the matter said.Days after the Moscow meetings, Kushner said in Kyiv that he had spoken to European counterparts about how the war had pushed up energy prices. He advocated “prosperity agreements” to encourage peace and give “leaders … something to look forward to”.
Lukoil assets also in focus
Kushner and Dmitriev have also discussed the possible sale of businesses owned by Russian energy company Lukoil, including oil refineries and petrol stations in Europe and elsewhere, two people familiar with the matter said.Under the proposal, a consortium involving the DFC and investors from Qatar and the United Arab Emirates would buy the assets, while US authorities would lift sanctions, the people said.“On Lukoil, Steve (Witkoff) and Jared (Kushner) worked with DFC to negotiate a substantial upfront payment and profits interest for the United States,” a White House official said.