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New sanctions, Nord Stream 2 certification, and Ukrainian transit—the main thing from Hochstein’s interview

Amos Hochstein, Senior Advisor for Energy Security at the US Department of State, said the United States and EU countries had already begun preparing new sanctions against the controversial Nord Stream 2 gas pipeline in case Moscow used gas as a weapon against Ukraine. In an interview to the outlet RBC-Ukraine, he added that the parties had already begun to determine what restrictive measures would be imposed in such a situation.

Nord Stream 2 certification and launch

Hochstein stressed his confidence in Germany's intentions to certify the pipeline in accordance with all the appropriate rules. The German regulator has four months (with the possibility of extension) to determine whether Gazprom's project meets the requirements of the Third Energy Package. If it does not take extra time, the decision will be made at the beginning of 2022, and after that the European agencies will be able to study it and express their opinion within two months. Only after that the regulator in Germany will issue a final verdict. In general, this process will take 6-7 months.

The State Department’s Advisor also said that the German side had promised not to allow Gazprom to start commercial operation of Nord Stream 2 until the official completion of the certification procedure.

Ukrainian transit

Hochstein once again stressed that Ukraine should remain a transit country.

"We are working to ensure that Ukraine continues to be a transit country for Russian gas supplies to Europe. But one more point—it is necessary that in case something happens to the transit, Ukraine would be able to get gas from Europe. Here it is necessary that the interests of energy security of both Ukraine and Europe coincide," he said.

The State Department’s Spokesperson added that the United States was examining several options for maintaining transit, including:

  • concluding a new contract with the Russian Federation,
  • encouraging Gazprom's European clients to sign agreements with the Russian gas monopoly with the obligatory condition of establishing gas delivery points on the Russian-Ukrainian border.

Hochstein noted that Kyiv needed to focus not on gas transit through its territory, but on the issue of its energy transition. This, according to him, will allow Ukraine "to become a full-fledged partner of Europe in the transition to new types of energy resources."

Context. Recall that initially Russia planned that Nord Stream 2 would be completed in 2019. However, this was prevented by American sanctions. In the end, the project was completed on September 10 this year.

Now it remains for the Russian Federation to ensure the gas pipeline certification. Shortly after the construction work completion, the Federal Network Agency of Germany obtained the documents for the Nord Stream 2 AG certification as an independent gas transmission operator.

The Gas Transmission System Operator of Ukraine expects losses of $5-6 billion annually if the gas pipeline is launched.

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