Decision suggests Pipeline restoration has not been ruled out, sources say
Two major German insurance companies have renewed cover for the damaged Nord Stream 1 gas pipeline, Reuters reported on Tuesday, citing sources.
The pipeline, which runs under the Baltic Sea and is capable of transporting 55 billion cubic meters of gas per year, was the main direct route for transporting natural gas from Russia to Germany before it was sabotaged last September . It has been out of service since then.
The renewal of insurance by Allianz and Munich RE means that the return to service of the pipeline is not ruled out, suggests Reuters. According to the agency’s sources, despite its public position of breaking ties with Moscow, the German government did not oppose the renewal of the insurance. This is essential for any long-term future of the pipeline.
Some German shareholders of Nord Stream (energy companies Wintershall Dea AG and PEGI/E.ON) would like to at least preserve the damaged gas pipeline in the event of an improvement in relations with Moscow.
A valid insurance policy would facilitate the repairs needed to resume gas flow, a source told Reuters. The insurance policy covers pipeline damage and business interruption issues, the agency noted.
Gas supply to the EU via Nord Stream was reduced and then completely suspended last year due to sanctions against Russia and technical problems. In September, a series of underwater explosions ruptured Nord Stream 1 and damaged parts of the newly constructed Nord Stream 2 pipelines. Several European investigations into the incident are ongoing.
The German government continues to claim that it aims to completely stop importing Russian natural gas by switching to alternative suppliers and other energy sources.
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