Report: Renzi joins opposition to Russia-German pipeline deal

MOSCOW, Dec 15 (PRIME) -- A controversial German pipeline deal with Russia has attracted a new adversary in Matteo Renzi, the Italian prime minister, whose frustration over the project is complicating efforts to extend the E.U.’s economic sanctions against the Kremlin, the Financial Times reported Tuesday.

Renzi last week blocked an effort to roll over the measures against Russia for another six months amid irritation at Germany’s insistence on moving forward with the pipeline, which largely follows the same path as the original Nord Stream pipeline, and its refusal to allow Brussels to review the project, known as Nord Stream 2.

His resentment over Germany’s championing of the plan has risen to such a level that his team has informed aides to Donald Tusk, the European Council president, that he wants to discuss the issue at Thursday’s E.U. summit, according to two senior E.U. officials.

In particular, the Italians believe that Nord Stream 2, backed by senior members of German chancellor Angela Merkel’s government, runs contrary to the spirit of the sanctions campaign and amounts to a powerful Germany putting its economic needs ahead of the bloc’s collective diplomacy.

“We are strong on sanctions, but on the other hand a number of countries, or companies, are able to double (the size of) Nord Stream,” one Italian official said.

The U.S. $11 billion Nord Stream 2 project, which Russian gas monopoly Gazprom announced in September with a consortium of five European companies, would connect Germany and Russia through the Baltic Sea, bypassing the three Baltic countries as well as Poland.

It has risen up the E.U. agenda in recent weeks after the Obama administration joined an increasingly vocal group of central and eastern European countries in objecting to the plan.

The original Nord Stream pipeline has long been seen as a geopolitical betrayal by many of the E.U.’s ex-Communist, eastern members — especially after Gerhard Schroeder, the German chancellor who advocated the pipeline, joined Nord Stream’s board after leaving office.

Critics of the new project argue that the existing Nord Stream pipeline can only operate at 50% capacity because it violates E.U. competition regulations, obviating any commercial need for doubling its size. Instead, they believe the project is part of a Russian strategy to build pipelines that bypass Ukraine, which would diminish the war-torn country’s strategic importance.

Berlin has so far resisted the pressure by insisting it is a commercial deal without government involvement or advocacy. But a Poland-led group of easterners has also been pushing for a debate at Thursday’s summit, raising the prospect of southern and eastern countries ganging up on Merkel.

In spite of their discontent, several foreign minister meeting in Brussels on Monday said they still expected sanctions against Russia to be extended after the discussion at the summit — a decision that would be based on Russia’s failure to fully adhere to the terms of a ceasefire agreement seeking to end the conflict in eastern Ukraine.

Federica Mogherini, the E.U. foreign policy chief, said: “I don’t see major problems in any of the member states on the political decision.”

Italy has often been among the strongest advocates for resuming normal commercial relations with Moscow. It is the second largest E.U. trader with Russia.

But Rome remains angry at Brussels’ decision to kill South Stream, another Gazprom pipeline project that was to bring Russian gas to Europe through Italy.

Italian oil group Eni was a major investor in South Stream, but Moscow cancelled the project last year after the European Commission repeatedly questioned construction contracts struck within E.U. transit countries, such as Bulgaria. Since the cancellation of South Stream, the Kremlin has attempted to reroute the pipeline through Turkey — but TurkStream became the victim of recent Russo-Turkish tensions over the downing of a Russian fighter over Turkish airspace.

Despite the E.U.’s role in killing South Stream, German leaders have publicly insisted Brussels has no authority over the Nord Stream 2 project since it will be built through international waters. E.U. officials said there were differing legal opinions over whether Brussels had the right to review the program under energy legislation passed in 2009, which was in part aimed at lessening Gazprom’s grip on Europe’s energy supplies.

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