Secure Energy for Europe Secure Energy Europe for The Nord Stream Pipeline Project The Nord Stream Pipeline Project Pipeline Stream Nord The 2005 2012 Secure Energy for Europe The Nord Stream Pipeline Project 2005 2012 Foreword »This project has stood in the broad public spotlight within Europe. In recent years, it has naturally been cause for discussion on many occasions, but these talks have always been conducted in a fair, practi- Nord Stream AG with headquarters in Zug, cal and constructive manner. I extend my Switzerland, is an interna- thanks and respect to everyone for that.« tional consortium of five major energy companies. Matthias Warnig Nord Stream Managing Director OAO Gazprom Russia (51 %) ou are holding a book that tells a unique story. It relates the stories of the people who have worked on one of the most prominent European energy supply projects: the Nord Stream Pipelines. It is always easy to convey the “big picture,” but our purpose here is to let those who built the world’s longest subsea pipelines tell the story in their own words: technicians, environmental engineers, and Yspecialists in approval processes, communication, and financing. We want to travel through time with you – to show you how it all began, how complex the processes were, and how transparency and perseverance enabled this twin pipeline system to go into operation after only six years. This book is dedicated to all those who have supported us over the years, including not only our employees, but also the rele- vant authorities in the Baltic region and neighbouring states, our suppliers, and, of course, our shareholders. This project has stood in the broad public spotlight within Europe. In recent years, E.ON Ruhrgas AG it has naturally been cause for discussion on many occasions, but these talks have Germany (15.5 %) always been conducted in a fair, practical, and constructive manner. I extend my thanks and respect to everyone for that. We have made every effort to provide even pipeline “laymen” with detailed insight into the unique challenges we faced through- out the project. Whether it concerned the sensitive ecology of the Baltic Sea, the BASF SE/ safety of marine traffic, fisheries issues, or life near our construction or operation Wintershall Holding GmbH facilities, people had – and continue to have – the right to learn about the potential Germany (15.5 %) impacts of our pipeline project, and what we as a company have done to minimise them. We appreciated their right and desire to participate and contribute in this regard. With this book, we are continuing with our philosophy of transparency, and N.V. Nederlandse Gasunie sharing our wealth of experience with all interested parties. The following eight The Netherlands (9 %) chapters outline the specific challenges and solutions involving the approval, con- struction, and operational phases. We believe our strategy of dialogue and trans- GDF SUEZ SA parency has stood the test. France (9 %) In 2006, following years of studies and negotiations, our founding shareholders, OAO Gazprom, E.ON Ruhrgas AG, and BASF SE/Wintershall Holding GmbH, es- tablished an independent project company in order to advance the planning and realisation of an additional reliable supply of energy from the vast Russian gas fields Foreword 3 to European end consumers. We have accomplished this, and, in restrospect, it developing relationships between individual countries. Anyone looking to pinpoint is safe to say, that it was the decision to establish an independent project com- all of the people behind such a complex project runs the risk of leaving someone pany that helped to move this vital project forward. This independence enabled off the list. However, I will try to name the significant stakeholders. Nord Stream to become a “speedboat,” able to navigate faster and more precisely through a sea of decisions than would otherwise have been possible in a “multi- There is the Nord Stream team, comprised of almost 200 dedicated employees corporate tanker.” from more than 20 countries. They have all rallied together to master the constantly changing project requirements with great team spirit. In the initial phase in the summer of 2006, a handful of employees met for the first time in Zug, Switzerland at the Nord Stream headquarters. Before they could even Secondly, there are the Nord Stream shareholders: OAO Gazprom, BASF SE/ think of how to build the pipelines, they were faced with other challenges: leasing Wintershall Holding GmbH, E.ON Ruhrgas AG, N.V. Nederlandse Gasunie, and office space, setting up the company in accordance with Swiss law, and aquiring GDF SUEZ SA. The valuable expertise these well-established companies shared requisite work permits. With a great deal of pioneering spirit, they succeeded in with Nord Stream laid the foundation for the project. And their far-reaching invest- »After six years of intensive work, »Nord Stream is Russia’s promise, just a matter of months in setting up an effective team, and in taking the project’s ment commitments, at a time when the results of the approval process were not the project was completed in 2012. welded in steel, to deliver the most first important steps. For that to happen, people from many companies in numer- yet certain, underscored their trust in the Nord Stream team. Nord Stream will be providing Europe important transition fuel for today, ous countries with different cultures and diverse plans for the future joined forces. with a reliable supply of Russian natural tomorrow, and years to come. These Again, I would like to express my gratitude for the exceptional support from the Thirdly, there are our suppliers and contractors such as Italy’s Saipem S.p.A., gas for at least the next 50 years. pipelines represent a means for the municipality of Zug, particularly in the set-up phase of the company. which handled construction. In the area of concrete coating and logistics, there The journey was long, laborious, and European Union to create a competitive was the French company EUPEC, the steel pipe suppliers from Germany, Russia, at times a bit bumpy. But we can point and sustainable energy mix.« Setting new standards and Japan, as well as service providers for environmental studies, IT, and many to outstanding results with pride.« After six years of intensive work, the project was completed in 2012. Nord Stream more. In this project, side by side with the Nord Stream team, they all had to grow will be providing Europe with a reliable supply of Russian natural gas for at least the together to become true partners in the process. next 50 years. The journey was long, laborious, and at times a bit bumpy. But we can point to outstanding results with pride. Nord Stream has set a new standard for Fourthly, there are the banks, export credit agencies, and insurers, who, in chal- successful project implementation: lenging times, worked together with Nord Stream to find solid financing solutions in a difficult market. It took just three years to obtain approval from five nations for construction of the pipelines. Nord Stream was part of a complex international consultation process Last but not least, I would like to focus on the constructive support for our project that involved nine countries. These consultations now serve as a point of refer- over the years from the governments of the shareholding countries, the European ence for the implementation of international conventions. Commission, the authorities in the participating countries, and non-governmental organisations. The open and goal-oriented nature of our dialogue and collaboration In just two years of construction, about 200,000 pipes – each weighing roughly has not been taken for granted, nor will it be. 24 tonnes – were expertly welded and laid on the seabed. That is an average of 2.5 kilometres a day, along which every weld seam was checked and certified. A look ahead We, the Nord Stream team, have delivered. The pipelines are operational, and will After intensive environmental sustainability studies, the results of ongoing en- be for at least a half a century. This timeframe alone gives one pause to reflect. We vironmental monitoring indicate that the effects of construction activities were have built something that could well reach beyond many of our own lifespans, and limited, and less than the conservative assumptions we had made and which had we have made a contribution toward Europe’s long-term energy security. The de- been approved by individual countries. We have built a pipeline system that is in mand for gas in Europe will clearly continue to grow. If Europe wishes to compete harmony with the Baltic Sea. globally, it will not succeed without gas and, in particular, not without gas from Rus- sia. Nord Stream is Russia’s promise, welded in steel, to deliver the most important In more than 23.5 million working hours, and with 2.4 million tonnes of steel to be transition fuel for today, tomorrow, and years to come. These pipelines represent a moved, a total of 148 marine vessels involved, and many other activities in and means for the EU to create a competitive and sustainable energy mix. around the Baltic, there was not one serious injury. We are significantly below the corresponding industry accident standard. In closing, in my seven years as Managing Director of Nord Stream AG, I have had the pleasure to meet and work with hundreds of exceptional engineers, technicians, The list of benchmarks can be further expanded in many regards. The international finance experts, and business and political leaders. Within Nord Stream, we formed professional organisations recognised these accomplishments with a number of a team that is unrivalled in its expertise and experience.