sign in sign up
<<
Home , Nord Stream, Power of Siberia

NO. 32 APRIL 2021 Introduction

Nord Stream 2 – ’s Dilemma Kirsten Westphal

The 2 project presents the German government with the dilemma of choosing between energy and foreign policy interests. Geopolitical arguments often prevail in the political discourse. Yet, a weighing of priorities requires a look at the energy policy context, too. When it comes to balancing interests, there are no easy or “cheap” answers. With a focus on the energy context, it has to be emphasized that a cooperative approach toward energy transformation promises the greatest dividend for a balance of interests, but it presupposes a minimum consensus within the Euro- pean Union (EU), along with the United States (US), , and .

By mid-April 2021, there were still nearly the German government to take a political 130 km missing from the Nord Stream 2 stance. pipeline (100 km in and 30 km in Germany), which stretches from Russia to Germany through the and is built Foreign Policy Changes in two strings of 1,230 km each. US sanc- tions had halted construction work for more Nord Stream 2 was launched by than a year starting in December 2019. and five European companies in 2015, one As a result of the sanctions, the continued year after the annexation of Crimea. In its construction, insurance, and certification dealings with the project, the German gov- of the pipeline is now a Russian matter. ernment took a fallback position early on, The package of US sanctions (Countering relying on existing German law and an eco- America’s Adversaries Through Sanctions nomic-technical position, and therefore it Act [CAATSA], the Protecting ’s classified the expansion of Nord Stream as a Act [PEESA], and the Protect- commercial project. Nord Stream 2 strength- ing Europe’s Energy Security Clarification ens the industrial location and the German Act [PEESCA]) has led to the withdrawal of gas market. In doing so, the German gov- many European companies. The US sanc- ernment followed the paradigm of separat- tions are designed to stop construction. ing trade and politics and sees economic in- This has brought the situation between terdependence not as a problem for its own Moscow and Washington to a head – a security, but as a basis for balancing interests. highly charged situation that threatens to The “compartmentalization” propagated end with at least one losing face, forcing by Germany, i.e., framing the issue as a

purely economic question, was shared relations. Indeed, all this raises the issue neither by the EU Commission nor by many of a continued downward spiral in energy other EU member states, which assessed the relations, where both sides are asymmetri- issue differently in the context of national cally but mutually vulnerable. Ultimately, (energy) security and the creation of the dealing with trade has also become a geo- Energy Union. These (geo)political dimen- political issue in a world characterized by sions (SWP Research Paper 3/2017) were not strategic rivalries and systemic competition, given enough consideration by the German in which trade and exchange have become government. Berlin resisted a transfer of political currency and supply chains are competences to Brussels for a long time, subject to normatively underpinned loyalty thereby missing the chance to hand over or antagonism. the controversial topic of Nord Stream 2 Since mid-2015, Berlin’s relationship to Brussels. Then, in April 2019, the EU’s with Washington has not been unaffected internal market rules were extended to by trends and changes of course in the US: pipelines entering the Union from third Although Berlin, or rather Brussels, con- countries. This amendment to the Gas tinued to impose sanctions against Russia Directive transforms highly political issues in coordination with the Obama adminis- into administrative action. Although this tration, this changed fundamentally during means that the issues at hand are less likely Trump’s presidency. Sanctions against to be politicized, it also limits the scope of Russia (and other energy-rich states) gained political action available to member states. their own momentum, driven in part by As the landfall state, it is now up to Ger- domestic politics in reaction to Russia’s many – in coordination with the EU – to interference in the US elections in 2016, regulate the section of the pipeline through but also by then-President Trump himself German . However, it as an element of the trade conflict and dis- quickly became apparent that the EU mem- pute over defense spending in NATO, and ber states had only reached a consensus on also as an expression of US energy domi- the wording of the text, but not on the sub- nance. Although the thrust of unilateral stance. sanctions is clear (to stop the project), the Much has changed in the environment range of motives is broad and the actual since the project was initiated: The five goal of the sanctions – to achieve a change European companies initially withdrew in behavior of the target – has been lost from the investment under pressure from from the focus. The secondary effects and the Polish antitrust authorities and instead externalized costs of these unilateral sanc- pledged financial investments of up to €950 tions for Germany and the EU were accepted million each. Transparency is an obvious as collateral damage, while the US itself con- casualty of political pressure. tinued to import oil from Russia in order More importantly, German-Russian rela- to be able to sanction Venezuela and Iran tions have deteriorated recently due to the (SWP Comment 6/2019, SWP-Studie 28/ Navalny case, the aggravated situation in 2019). After took office on Janu- eastern Ukraine, and Russia’s disinforma- ary 20, 2021, a small window for compro- tion campaign against Germany. Thus, mise around Nord Stream 2 opened, but it this pipeline deal no longer functions as seemed to quickly close due to congressional an element for easing tensions – not only pressure. Secretary of State because of the repercussions on Ukraine. then said the project was “a bad idea” and Instead, as political science argues, energy contrary to EU interests – as well as US and foreign relations often reinforce each security interests – during his inaugural other in their tendency toward cooperation visit to Brussels on March 24. The basic or conflict. This is precisely why Berlin hopes tenor of the Biden administration is more that the construction of Nord Stream 2 keeps cooperative, but also more normative: It is costs high on the further deterioration of about restoring the transatlantic relation-

SWP Comment 32 April 2021

2 ship and a shared attitude toward authori- that is approximately 1,000 km shorter, tarian regimes. Beyond the short-term twists more modern, and more efficient than the and turns, a realignment with Washington one through Ukraine. remains no easy matter because, although Gas production in the interests coincide in the systemic competi- (UK), Denmark, the Netherlands, and Ger- tion with , Europe’s exposure is dis- many has fallen by more than half between proportionately higher in the geo-economic 2009 and 2019, to 76.2 billion cubic meters disruptions, as well as in the energy trade. (bcm). The large Dutch gas field in Groningen The shock of the confrontation with Presi- will cease production altogether in 2022. dent Trump endures, as does the realization Northwest Europe is Gazprom’s most im- that the US remains a deeply divided coun- portant sales market, with the UK and Ger- try and that its energy wealth sets it apart many being the biggest customers with from the EU in terms of energy policy. around 57 bcm (2019). Production in the EU Germany is in a predicament: Russia has fallen faster and to a greater extent than severely undermines the security situation was assumed in the 2017 Prognos study, in Europe, and US sanctions make the pipe- which formed the basis for the Nord Stream line a matter of national sovereignty. Oppo- 2 plan approval procedure. The study only sition in the EU to the pipeline masks the assumes a reduction of 41 bcm by 2025. fact that Washington is also undermining The Prognos study forecasted imports of Brussels’ powerful instrument of regula- 376 bcm from the EU28, plus tion; broader questions concerning the stra- and western Ukraine, for 2020. In reality, tegic energy capacity to act with and vis-à- total net imports of around 407 bcm were vis the US also arise for the EU (SWP Com- already significantly higher in 2019. Ac- ment 7/2021). The August 2020 demarche to cordingly, about 170 bcm were purchased Washington by 24 EU member states gave from Russia. voice to this concern. Thus, political posi- Geology also plays a role at the Russian tions have hardened since 2015. In the fol- end of the pipelines, as the old gas fields lowing, this Comment will take a closer of the Nadym-Pur-Taz region have passed look at the energy context, which has their peak production levels. In contrast, equally changed since then. production levels on the Yamal Peninsula are growing. Thus, Gazprom has to manage the gas fields (and their depletion) with a Energy Security view to exports and consumption. The main export sources as well as routes are shifting The two additional lines of Nord Stream 2 primarily to the north, or from eastern do not pose a threat to European energy to China, if the “” – security, nor are they indispensable for the with an annual capacity of 38 bcm – is security of gas supply. Since the project is included in the picture. The huge capacities contextualized geopolitically in a hybrid at the Yamal Peninsula are also a reason threat scenario for Europe and even the why China and Russia are negotiating the US, it is worth taking a broader view of the “Power of Siberia 2,” which has a capacity energy context, looking first at geography, of 50 bcm from western Siberia. geology, infrastructure capacities, and sup- It is, of course, in theory correct that the ply volumes, and second at the gas con- EU, Ukraine, and the Western Balkans and sumption pattern. Turkey could also be supplied via the exist- On a strictly economic basis, Nord ing pipeline network. The old gas pipeline Stream 2 doubles the transport capacity system through Ukraine has a nominal through the Baltic Sea by 55 billion cubic- capacity of 146 bcm per annum, the Yamal- meters (bcm) and connects the newly devel- Europe pipeline through and Bela- oped deposits on the Yamal Peninsula with rus 33 billion m3, and Nord Stream 55 bcm the major gas markets in Europe via a route of gas from Russia. In addition, there

SWP Comment 32 April 2021

3 are pipelines to Turkey: TurkStream with Climate Policy Considerations 31.5 bcm, with 16 bcm, and a small pipeline to . Even without the The political pressure on Nord Stream 2 is additional 55 bcm of Nord Stream 2, there even higher because of the fact that it is a are no pipeline bottlenecks. This is, how- fossil fuel infrastructure project. The pipe- ever, a very simplistic view. line is considered to be a bet by the energy The connecting pipelines from Greifs- companies against European climate pro- wald into Germany are in operation and tection. And indeed, in order to achieve function as an integral part of the gas net- climate neutrality by 2050, the consump- work. These pipelines are regulated and tion of will have to drop mas- have been part of the German Network sively. However, scenarios aimed at achiev- Development Plan as well as a European- ing the climate target currently diverge wide market survey (in the case of the Euro- widely from trend scenarios. The above- pean Gas Pipeline Link [EUGAL]). Yet, if mentioned consumption data also shows Nord Stream 2 does not come on stream, that there has been no trend reversal in these investments are partly stranded costs gas consumption thus far. that may put a burden on gas consumers. A dilemma arises between the speed The Ostsee-Pipeline-Anbindungsleitung of emission reductions and the depth of (OPAL) has been reduced to only half of its decarbonization when arguing about the pipeline capacity following a ruling by the use of natural gas as a bridge. Natural gas General Court of the EU in September 2019 replaces coal in the industry and in power that was issued after a complaint by Poland. generation. Because Germany will phase In addition, the European Gas Pipeline Link out nuclear power in 2022 and coal more (EUGAL) has been available since April rapidly than 2038, it is very likely that the 2021 and offers a capacity of 55 bcm. The consumption of natural gas will increase connecting Gazela pipeline can transport over the next decade. Thus, there is a con- around 30 bcm via the to crete question about the security of supply Waidhaus, the old entry point to Germany in the transition period. In the public debate, through which the volumes were imported however, the predominant focus on annual via Ukraine. import volumes and possible transport However, the expansion of transport routes is misleading. For this reason, fluc- capacities does not automatically mean that tuations in the seasonal consumption of gas more gas would be purchased from Gaz- will increase massively beyond 2030, with prom. The decisive factors for gas purchases monthly gas consumption in Germany are, in fact, Gazprom’s own sales strategy as already being more than three times higher well as existing long-term contracts with in the winter months than in individual their take-or-pay clauses, i.e., the volumes summer months. In the winter, cold spells that the buyers must pay for in any case coincide with so-called Dunkelflaute. An and will therefore also purchase. In addi- assessment that takes an accurate view at tion, “nominations” are made according to points in time suggests the need for capac- price signals, i.e., orders are placed where ities and flexibilities in the infrastructure. the cheapest gas can be obtained. This is In the past, this function was fulfilled by why the shares of storage facilities and gas fields in the EU. (LNG) deliveries to Europe have fluctuated The latter will soon be missing. During the in recent years. Estimates suggest that, until cold spells of 2019 and 2021, pipelines from at least 2030, Gazprom has long-term con- Russia were running at full capacity. The tract supply commitments of around 120 cold spell of February 2021 also showed billion m3, and has thus secured a signifi- that LNG followed a price logic that makes cant market share in Europe, which it must Europe the “last resort” of LNG. This means also serve. nothing other than that much higher prices would have to be paid for LNG during a

SWP Comment 32 April 2021

4 cold snap to divert volumes to Europe: On through Ukraine. What led to this – February 19, the LNG spot price in East Asia whether it was US sanctions or negotiating was more than 80 percent higher than the and mediating skills – is open to debate. gas price in Europe. At the same time, LNG However, a breakthrough was achieved exports from the US had also plunged by on gas transport: a new contractual rela- two-thirds in February. Notwithstanding, tionship between Russia and Ukraine that LNG from the US, Russia, or Qatar has complies with EU rules and lays a stable become an important part of the EU and and binding contractual foundation until Europe’s gas mix, but for ensuring supply, the end of 2024. This guarantees Ukraine the price – as well as time factor regarding transit revenues of at least $7.2 billion. when tankers arrive – plays a major role. Accordingly, Gazprom booked firm In this respect, more climate protection transport capacities of 65 bcm in 2020, also creates new opportunities but also followed by firm capacities of 40 bcm in the new challenges for security of supply. The 2021–2024 period. The contract is on daily energy transformation means a phase char- volumes, which does not give seasonal flexi- acterized by high uncertainties and vola- bility. These ship-or-pay volumes must be tilities for the transition period, which will paid for independently of the actual service. in any case put supply relations and the gas The tariff is significantly higher than on the transmission system under great stress. competing Yamal-Europe or Nord Stream 1 Stopping Nord Stream 2 for climate routes, as Ukraine’s system is designed for policy reasons would mean a sensitive inter- higher volumes. If Gazprom wants to ex- vention in the gas value chain. Physically, a port more natural gas through Ukraine, it source of flexibility would be missing, with would have to book larger transport vol- no (see above) direct impact on supply umes at even higher prices in the short term. volumes, and no corresponding successful 2020 has made it clear that Ukraine is savings on the demand side. Sometimes, the now increasingly integrated into the Cen- argument is put forward, that it is to pre- tral European gas market. The following vent the price-dampening effect that the integration steps have been taken by pipeline has on German gas customers. Yet, Ukraine in recent years: physical and if fossil energy is to become more expen- virtual gas imports from , Poland, sive, there are other approaches that have and Hungary, more price convergence of less impact on the security of supply. imported gas with European hubs; imple- If natural gas is to become successively mentation of EU network codes; use of its more expensive, then creating a physical gas storage facilities for Eastern Europe due shortage is the wrong step; a price for CO2 to attractive commercial conditions; and and methane emissions could be set in- maintaining gas transport in competition stead. It is correct that methane emissions with other routes. Ukraine no longer buys must be monitored along the entire supply gas volumes directly from Russia for its own chain and not just used as an argument for consumption, but from the EU. These steps or against a modern pipeline through the actually lead the way ahead and make it Baltic Sea. Dealing with methane emissions possible in the first place to participate in and decarbonizing the gas supply chain is the EU’s strategic goal – a climate-neutral therefore a very important starting point continent by 2050. for international cooperation with the So if more far-reaching compromise solu- Biden administration and other partners. tions are sought now, the main issue dis- cussed is how to guarantee the transport of natural gas from Russia beyond Decem- Integrity of Ukraine ber 31, 2024. Considerations today about extending the agreement make sense, but At the end of 2019, an agreement was they are difficult to implement in detail. reached with Russia on gas transport First, there are good reasons against reopen-

SWP Comment 32 April 2021

5 ing the agreement. Even a potential exten- ern Europe have diversified, and purchases sion is difficult, as the issue of gas transport of Russian natural gas through Ukraine are tariffs for the next regulatory period of decreasing, not only as a result of the con- 2025–2029 shows. Tariffs are unlikely to struction of TurkStream and the conse- be set by the National Regulatory Authority quent rerouting of Russian gas, but also due of Ukraine (NEURC) until 2024. Expecting to competition from LNG, especially from Gazprom to reserve capacity already today the US. All this together means that Gaz- without knowing the tariffs is hard to prom will be guided by long-term contracts imagine. On the other hand, as suggested with Slovakia, Moldova, and partly Romania, in a study by IHS Markit, it would be quite which it primarily serves via the Ukraine conceivable to set aggregate annual tariffs, corridor. The past months display that Gaz- e.g., which would then be paid in advance prom is obviously not really willing to book by Gazprom into a trust fund managed by extra and expensive capacities via Ukraine. the EU for a longer period. This would pro- The Ukrainian corridor is less competitive vide Ukraine with more planning certainty vis-à-vis the other transport routes into for decommissioning pipes or converting Europe. If this remains the case after 2024, parts of the system for the transport of even if Nord Stream 2 does not come on hydrogen. The old system had a capacity line, there will be fewer additional book- of 146 billion m3, which was already only ings beyond the 40 bcm per year. partially utilized in 2019 with 89.6 bcm of annual transport volume. In 2020, Gazprom shipped 55.8 bcm of Prospects for Eastern Europe gas, less than the capacity booked (65 bil- lion m3). ICIS also reports that Gazprom Ukraine is important to the configuration booked only slightly more than the daily of gas flows in the region. It stopped buying requirement of 109.6 million cubic meters Russian gas directly in 2015 following Rus- in the first four months of 2021 and no sia’s annexation of Crimea and support for additional capacities in May 2021. armed separatism in eastern Ukraine. It In the future, transported volumes began to meet its gas import needs through through Ukraine will remain flat or de- physical and backhaul imports from Cen- crease because of changing flow patterns tral Europe, primarily from Slovakia, but in South-East Europe. First, TurkStream, also from Hungary and Poland. With this which extends from Russia to the European step, Ukraine became part of the Eastern- side of Turkey, was completed, and since Central European gas market, which, as January 2021 volumes through Bulgaria described above, is already largely integrated to Serbia have been delivered through into the EU internal market. the second leg with a capacity of 6 bcm Geostrategic considerations about the gas and later 8.5 bcm. Moreover, Gazprom region between the Baltic Sea, the Adriatic will reroute gas delivered to Hungary and Sea, and the Black Sea should acknowledge Romania (7.5 bcm in 2020) from Ukraine the big success story of EU gas policy: through TurkStream. Second, the Trans The construction of the interconnectors, Adriatic Pipeline (TAP) started its deliveries the application of EU regulation and, most of Azerbaijani gas through Greece and recently, the implementation of the anti- Albania to Italy in December 2020. It will trust proceedings against Gazprom have later also supply one-third of Bulgaria’s gas brought more competition to the markets needs when the Greece-Bulgaria intercon- and more price convergence with the gas nector is completed. In addition, there are hubs of northwest Europe. Gazprom’s LNG terminals in Revithoussa, Greece, Krk, dominant market position has ended. Gas Croatia, and from 2022, Alexandroupolis, flows are changing with an increased role Greece, as well as similar facilities in Tur- of the Czech Republic and Bulgaria, com- key. As a result, gas supplies in southeast- pared to Slovakia and Romania in the past.

SWP Comment 32 April 2021

6 It is not only Nord Stream 2 itself, but US, Russia (from Novatek and Gazprom), also the (energy) political reactions to it that and Qatar, as domestic, Algerian, and also cement a certain division in the gas market. Norwegian production levels decline or In the Three Seas Initiative, the Eastern and level off. It is primarily the LNG supply Central European countries are not only from Qatar that will increase significantly pursuing a course of North-South intercon- on the world market after 2025, from 110 nection among themselves, but also prim- to 152 bcm per year. Both LNG and Russian arily of integration into the international pipeline gas have a balancing role – on the gas market in order to reduce dependence European as well as the global market. on Russia’s Gazprom (SWP-Aktuell 16/2021). This sets the EU apart from the US: It has Although this is an important step for the a vital interest in gas market cohesion and energy sovereignty of the countries, the not in a “cordon sanitaire.” Moreover, Russia cohesion of the EU gas market must also remains not only a neighbor, but also a remain in view. It will also be necessary to major supplier of energy and raw materials, observe whether and how gas flows will on which an energy transformation will change from October 1, 2021, with the newly have to rely and which has to made part of established unified German market area a climate-neutral Europe by 2050. Zero-sum (Trading Hub Europe, THE) and its new games in the gas sector then really lead to tariffs. dead ends. This is because Europe’s energy The Polish gas market remains largely supply presupposes a modus vivendi with sealed off from the northwestern European Moscow. The application of EU regulations market by trade barriers – a consequence and market mechanisms has proved to be of Polish energy policy, which focuses on a promising and effective pathway for an the physical substitution of Russian gas vol- ever better-functioning and competitive gas umes by 2022 and has blocked more inter- market. A market approach creates options connectivity with Germany. Due to these for necessary cooperation on natural gas barriers and special regulations, the Polish and the energy transition: It would be pos- market is largely monopolized. This divid- sible to negotiate gas supplies from Central ing line is politically sought by Warsaw and Asia through Ukraine and a “gas release” in driven by energy economic interests of its the form of, e.g., the auctioning of Russian major incumbent. gas volumes via Gazprom’s electronic trad- Poland’s gas consumers pay a higher gas ing platform at various entry points. The price for this policy, which is sold politically extent to which these options remain pos- as a contribution to genuine diversification. sible – if Nord Stream 2 is stopped for The expansion of gas infrastructure was external and geopolitical considerations – financed with EU funds. At this point, a is difficult to assess. However, the shift to circle closes with regard to the difficult geopolitics would weaken market mecha- balance between climate policy and secu- nisms and close this route (for now). rity of supply. Russia has a strong position in the EU market. At the same time, there is flexibility as well as options to replace a Options for Action (partial) shortfall in volumes in the short and medium terms. However, if the energy Germany’s dilemma stems from political transition does not succeed faster across circumstances and the challenge of balanc- Europe, the high level of dependence on ing economic and foreign policy interests. Russia will remain, which in turn could Depending on the political choice, two and trigger more LNG infrastructure invest- a half options arise in the context of energy ments for diversification. policy from the current situation: 1) partici- In the future, European import demand pation in the sanctions against Russia to will have to be met mainly by pipeline gas stop construction; 2) active flanking of the from Russia and by LNG mainly from the project and search for a compromise. A pas-

SWP Comment 32 April 2021

7 sive wait-and-see approach is not really a hydrogen (for Europe) from (Russian) natu-

political option, as US pressure alone forces ral gas and store the CO2 captured in the pro- a position. cess. Ukraine can take a key role in “clean

Regarding the first option, stopping the gases,” hydrogen, and CO2 capture and construction has already proven to not be storage. Yet, this depends on a stable and easy for the US, since many activities are reliable regulatory and investment frame- now being carried out by Russian compa- work in the country. Furthermore, Ger- nies. Thus, sanctions aimed at stopping the many could become even more involved in pipe-laying activities would result in a con- the Three Seas Initiative. It would also be frontational situation. Moreover, sanctions conceivable to extend gas transport through © Stiftung Wissenschaft would need to be executed jointly in the EU Ukraine. und Politik, 2021 (and in coordination with the US) without One of the central ideas from Washing- All rights reserved violating the norm of non-discrimination. ton, however – the emergency brake and There is also the concern of damage claims. snapback mechanism – is difficult to im- This Comment reflects This approach would require a clear ration- plement for at least two reasons. First, there the author’s views. ale for imposing the sanctions and a con- is currently no foreseen regulatory mecha- The online version of sensus in the EU. Sanctions are linked to nism that can be used. Second, the “quid this publication contains conditions for a change in behavior, which pro quo” would not only cost the EU dearly functioning links to other must be achievable, otherwise sanctions in literal terms, but it would also – depend- SWP texts and other relevant become an end in themselves. Even if oppo- ing on its duration – be accompanied sources. nents call the situation around the project by massive restrictions on the security of SWP Comments are subject a race and an endgame, such a step would supply. to internal peer review, fact- be a big bang, but it would be more of an However, there is still leeway regulatory- checking and copy-editing. opening for a next round (of escalation) and time-wise after the completion of the For further information on with no discernible benefits. Who benefits pipeline that can be used for political nego- our quality control pro- from a ruin in the Baltic Sea? If new sanc- tiations. There are still stopping points on cedures, please visit the SWP website: https://www.swp- tions are seen as the political way forward, the way to the commissioning of the pipe- berlin.org/en/about-swp/ then it would be more effective if the EU line: the acceptance of the pipeline and the quality-management-for- and the US were in lockstep against Russian implementation of the Gas Directive. Gaz- swp-publications/ oil supplies. Here, the Kremlin is more vul- prom and the Kremlin will then have to nerable, but also the costs between the EU disclose which rules they want to play by. SWP and the US would be more equally dis- At what point in time what volumes of Stiftung Wissenschaft und Politik tributed. whose natural gas will then actually flow German Institute for Regarding the second option, the build- through the pipeline and who operates it International and ing blocks for finding a compromise are are potentially also questions of compro- Security Affairs actually obvious: further integrating mise. Ukraine into the EU internal energy market, Ludwigkirchplatz 3–4 10719 Berlin not only through synchronizing Ukraine’s Telephone +49 30 880 07-0 electricity grid with the EU’s electricity grid, Fax +49 30 880 07-100 but also through the extension of gas trans- www.swp-berlin.org port or its decarbonization. Moreover, the [email protected] region between the Baltic Sea, the Adriatic

ISSN (Print) 1861-1761 Sea, and the Black Sea is predestined for the ISSN (Online) 2747-5107 production of green gases and hydrogen. In doi: 10.18449/2021C32 theory, this is particularly true for Ukraine, which could benefit from its geographical (Updated and revised position: The country has the potential English version of to produce green hydrogen, but also blue SWP-Aktuell 33/2021)

Dr Kirsten Westphal is a Senior Associate in the Global Issues Research Division at SWP. She heads the Project “Geopolitics of Energy Transformation – H2” funded by the Federal Foreign Office.

SWP Comment 32 April 2021

8