What the US-German deal on Nord Stream 2 promises Ukraine

At the Nord Stream construction site in Lubmin. Image: Nord Stream 2 / Paul Langrock 

International

The United States and Germany have formally agreed to complete the construction of Russia’s Nord Stream-2 gas pipeline by issuing a joint declaration with promises to Ukraine. The text of the declaration, published by the US Department of State, is entitled “Joint Statement of the United States and Germany on Support for Ukraine, European Energy Security, and our Climate Goals.”

The document begins with an assurance that the United States and Germany strongly support Ukraine’s sovereignty, territorial integrity, independence, and European path, and reaffirm the need to take action against Russian aggression and Russia’s destructive actions in Ukraine and abroad.

Further, the USA claims it supports the German and French efforts to secure peace in Ukraine through the Normandy format, and Germany says it will “intensify its efforts within the Normandy Format to facilitate the implementation of the Minsk agreements,” a series of protocols that have failed to bring peace to Ukraine due to Moscow’s unwavering demands that Ukraine sees as undermining its sovereignty. 

The agreement stipulates that if Moscow attempts “to use energy as a weapon or commit further aggressive acts against Ukraine,” Germany would undertake unspecified national measures and initiate EU-level actions, “including sanctions,” to restrict Russian energy exports. 

The US and Germany agree that it is in the interests of Ukraine and Europe to continue the transit of Russian gas through Ukraine after 2024. Therefore, Germany vows to use all available means of influence to allow the extension of the gas transit agreement with Russia for up to ten years, and to appoint a special representative for this purpose.

It is noted that negotiations on this issue should begin as soon as possible, but no later than 1 September 2021.

Germany is committed to creating and managing a Green Fund for Ukraine that will promote its energy transition, energy efficiency, and energy security.

Germany and the United States will seek to encourage and support investments in the Green Fund of at least $1 bn, including from third parties such as the private sector.

Germany will initially add at least $175 mn to the fund as a grant and will work to increase its contributions in the coming years, the declaration said.

The fund will promote the use of renewable energy sources, promote the development of hydrogen as an energy source, increase energy efficiency, accelerate phasing out coal, and maintain carbon neutrality.

The US plans to advance the initiative with technical and strategic assistance in line with the Fund’s objectives.

In addition, Germany will continue to promote bilateral energy projects with Ukraine, especially in the field of renewable energy and energy efficiency, as well as support for phasing out coal, which also includes the appointment of a special envoy with dedicated funds worth $70 mn.

Germany is also ready to launch a package of sustainability measures for Ukraine that will support Ukraine’s energy security. This includes efforts to provide and increase opportunities for a reverse gas flow to Ukraine in order to fully protect Ukraine from potential future attempts by Russia to reduce gas supplies to the country.

In addition, Germany will allow Ukraine to participate in its projects to support and cooperate in the development and expansion of cyber capabilities, will support efforts to reform the Ukrainian energy sector, and will help develop options for modernizing Ukrainian gas transmission systems.

In response to the agreement, Ukrainian Foreign Minister Dmytro Kuleba has asserted that Ukraine wants “stronger formulations” for questions of security in the German-US deal and released a joint statement with his Polish counterpart, vowing to oppose the deal until solutions are developed to address the security crisis created by NS2, to provide support to countries aspiring to membership in Western democratic institutions, and to reduce threats to peace and energy security.”

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