(Bloomberg) -- Russia’s controversial Nord Stream 2 pipeline lost the latest round of its legal fight against European Union gas market rules, in a largely symbolic court defeat for the now-shuttered project.
Gazprom PJSC-controlled Nord Stream 2 should have foreseen that the bloc would use its powers to “extend the internal market rules to cover gas pipelines from third countries,” the General Court said in its re-examination of the case on Wednesday.
Nord Stream 2, operated via Zug, Switzerland, has been challenging EU legislation from 2019 that includes curbs on natural-gas import infrastructure being run directly by suppliers. In 2020, the EU General Court threw out Nord Stream 2’s case, but then the bloc’s top court told the lower chamber to re-examine the decision.
While the ruling is a loss for the owners of the pipeline linking Russia to Germany through the Baltic Sea, it’s unlikely to have any immediate impact on a link that was already blown off course by geopolitics before it was partly destroyed by saboteurs following the invasion of Ukraine.
Nord Stream 2 filed for bankruptcy soon after Russia invaded Ukraine in early 2022. Even though plans for Nord Stream 2 remain in tatters, the pipeline could still eventually be resurrected — with American dealmaker and Donald Trump backer Stephen P. Lynch emerging as a surprise potential bidder, according to the Wall Street Journal.
The project was slated to double the capacity of the existing undersea route from Russian gas fields to Europe, but has been a major source of friction in trans-Atlantic relations for several years.
It was set to carry as much as 55 billion cubic meters of Russian gas per year to Germany, and was ready to start full-scale deliveries despite U.S. sanctions. Approval from the German energy regulator and EU officials were the last hurdles for the project, but Berlin reversed its support following Russia’s decision to wage war with Ukraine.
President Vladimir Putin has repeatedly told Europeans that one string of the Nord Stream 2 pipeline to Germany remains intact after explosions destroyed the other conduit in September 2022.
Germany also purchased idled pipes that belonged to the Nord Stream 2 consortium to instead build an LNG hub on site of the pipeline’s entry in the nation.
Land-based links that were once used to distribute further the gas arriving via Nord Stream, or planned for the Nord Stream 2 use, are now used to bring gas from Germany’s new LNG import terminal on the Baltic Sea coast.
In a dramatic turn of events, saboteurs struck in September 2022, damaging both channels of the Nord Stream 1 pipeline as well as one of two for Nord Stream 2 in the waters near the island of Bornholm in eastern Denmark. The blast demonstrated the vulnerability of seabed infrastructure and prompted an increased military presence in the Baltic Sea.
The case is T-526/19 RENV Nord Stream 2 v Parliament and Council.
(Updates with background throughout)
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