German regulator pauses certification of Nord Stream 2 pipeline
Germany's network regulator said Tuesday that it paused its certification of the Nord Stream 2 pipeline due to an issue with the company's license under German law, the Associated Press reports.
Why it matters: The pause throws a wrench in the approval process of the already contentious pipeline — which would transport Russian gas to Europe under the Baltic Sea — and caused regional gas prices to rise.
Driving the news: "Following a thorough examination of the documentation, the Bundesnetzagentur concluded that it would only be possible to certify an operator of the Nord Stream 2 pipeline if that operator was organized in a legal form under German law," the regulator said in a statement, per AP.
- The news of the pause triggered an increase in natural gas markets in Europe, including in the U.K., where natural gas futures rose more than 9%, according to the New York Times.
- The certification process will remain on pause "until the main assets and human resources have been transferred to the subsidiary," per AP.
- The pipeline is owned by Russian-controlled gas company Gazprom with investment from several European countries.
- President Biden earlier this year waived sanctions on firms involved in the pipeline, which in 2019 stalled its progress, frustrating Germany and the European Union, Axios' Jonathan Swan reports.
- Seeking to mitigate fears from members of Congress and Eastern European countries over Russia potentially using the pipeline against Ukraine, Biden and German Chancellor Angela Merkel reached a deal in July.
- Per the agreement, the U.S. and Germany will intervene if Russia tries to "use energy as a weapon," set up a "green fund" to help Ukraine modernize its energy sector, and seek to ensure Russia continues to pay Ukraine around $3 billion in gas transit fees annually.
Go deeper: Russia's Gazprom says Nord Stream 2 pipeline is complete