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European companies step back from Nord Stream 2 pipeline

Staff Writer |
A plan for several European energy companies to team up to build a second natural-gas pipeline Nord Stream 2 from Russia to Germany has collapsed.

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An application with Poland's competition authority to form a joint venture to build a pipeline called Nord Stream 2 was withdrawn in the face of opposition from Warsaw.

In connection with proceedings ongoing since December 2015 UOKiK conducted an extensive market study, concerning among other things the views of firms in the natural gas sector in Poland on the envisaged concentration.

The Energy Regulatory Office (URE) was also asked to give its views on the deal. UOKiK’s concerns were confirmed by the study.

The intended concentration could lead to restriction of competition. Gazprom has a dominant position on the market when it comes to supplying gas to Poland, and the deal could strengthen further the company’s negotiating position with regard to users in Poland.

"Withdrawal of the application means that the joint venture that was to construct the Nord Stream 2 gas pipeline cannot be formed by the six firms. This will stop the deal," said UOKiK President Marek Niechcial.

The request to withdraw the application was submitted by the six undertakings taking part in the intended transaction – PAO Gazprom from the Russian Federation, Uniper Global Commodities SE from Germany, ENGIE SA from France, OMV Nord Stream II Holding AG from Switzerland, Shell Exploration and Production (LXXI) B.V. from the Netherlands, and Wintershall Nederland B.V. from the Netherlands.

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