GERMANY’S energy regulator has suspended the approval process for a major new pipeline bringing Russian gas into Europe, throwing up a new roadblock to the contentious project and driving up regional gas prices. The watchdog said Tuesday it had temporarily halted the certification process because the Swiss-based consortium behind Nord Stream 2 first needed to form a German subsidiary company under German law to secure an operating license. “This does push back expected timelines quite a bit,” said analyst Trevor Sikorski at Energy Aspects, adding that it was unclear how long the process of establishing a new firm and reapplying for certification would take. First flows through the pipeline look very unlikely in the first half of 2022, he added. Nord Stream 2 has faced stiff opposition from the United States and some European states, which say it will make Europe too reliant on Russian gas. But other European governments say the link is vital to secure energy supplies, with gas prices surging in recent weeks and the threat of power outages looming this winter. Nord Stream 2 said it had been notified by the regulator about the certification decision. “We are not in a position to comment on the details of the procedure, its possible duration and impacts on the timing of the start of the pipeline operations,” it added. “Any delays in the pipeline certification, all the more so on the eve of winter, is not in the interests of the European Union, that’s without any doubt,” Konstantin Kosachyov, deputy chairman of Russian parliament’s upper house, told TASS news agency. The regulator, the Bundesnetzagentur, said it would only assess an application after a transfer of major assets and budgets for staffing to a German subsidiary. “A certification for the operation of Nord Stream 2 will only be considered once the operator is organized in a legal shape compliant with German law,” it said. Once these preconditions had been met, it said it could continue assessing the submission in the rest of the four-month application period. Before the suspension, that period was meant to run until early January. Lawyers said the move, viewed by some gas market traders as politically charged, made sense from a regulatory perspective because it meant the pipeline’s operators in Germany would be answerable to local rules. Essen-based law firm Rosin Buedenbender said a number of limited liability company options were available. Ukraine is one country bitterly opposed to the pipeline, which has fed into broader tensions between Kyiv and Moscow at a time when the United States has accused Russia of building up troops near Ukraine in preparation for a possible attack, an allegation the Kremlin has dismissed. The head of the Ukrainian energy firm Naftogaz said that he welcomed the German energy regulator’s decision. “Good,” Yuriy Vitrenko said. “This is an important point, which suggests that the German regulator shares our position that certification cannot only apply to the pipeline in Germany, but should apply to the entire pipeline from the territory of the Russian Federation to the territory of Germany.” Kyiv will lose revenues if gas from Russia bypasses it and it accuses Moscow of using energy as a weapon to threaten Europe’s security. Moscow has denied this and says Nord Stream 2 is a purely commercial venture that complies with European energy rules. Ukraine has successfully applied to be part of the consultation process to certify the pipeline. (SD-Agencies) | 