The German Federal Network Agency has announced the temporary suspension of the approval process for Nord Stream 2, the controversial gas pipeline between Russia and Germany, citing a legal obstacle. The certification of Nord Stream 2, which is one of the last steps before its commissioning, “is only possible if the operator is organized according to a legal form under German law,” the authority wrote in a statement. The pipeline connects Germany to Russia via the Baltic Sea.
The decision of the German energy regulator to suspend the certification procedure causes the sharp rise in the price of gas on the European market: the December contract of the TTF, used by operators as a benchmark for the European market, marked a jump of 11 % at 88 euros / MWh immediately after the announcement.
Prices are also supported by the stop to production of a field in Norway due to technical problems, which according to expectations will not be resolved before Friday.
The German regulator said it has suspended the certification process for the Nord Stream 2 project due to a change of legal form at its company. Nord Stream 2 AG has decided to establish a branch to become the owner and operator of the German section of the pipeline, so the authorization process has been suspended until the main assets and human resources are transferred to the branch.