Sun24 Press

Episode 2: The US Government, the UK and Ukraine

The destruction of the Nord Stream pipeline is one of the most consequential acts of sabotage in modern history, yet it remains unsolved.

The reports we have heard about it are usually either biased, superficial, or deflective.

This is the second podcast episode about the Nord Stream affair, the result of in-depth research from many sociopolitical angles. The podcast covers a timeline stretching from several months before the explosions to the events that followed on September 26, 2022.

Contents:
The details of the sanctions (→ 1:03)
Ukraine elected a new president (→ 02:43)
Ron Johnson in the US Senate Committee (→ 04:56)
The UK also didn't like the project (→ 05:50)
The UK was studying the case (→ 08:06)
The messages from transatlantic organisations (→ 10:01)
The suspension deal (→ 11:09)
Brexit had a role (→ 12:53)
The German election of 2021 (→ 14:30)
The UK shifts its rethoric towards suspending both pipelines (→ 16:19)

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Episode 2

NordStream Refilled - The US, UK and Ukraine

00:00

Here the link to our article with issues related to Trump's impeachment attempt from 2019, involving a phone call with Selensky and a company called CrowdStrike:
sun24.press/en/a-crowded-strike-about...

Here the link to the US Senate Committee hearing from December 7, 2021 (Ron Johnson speaks after the 01:07:00 timestamp, very important are also the last 20 minutes of the hearing, starting at about 01:57:00):
foreign.senate.gov/hearings/...

Previous
Episode 1 - The Introduction

Next
Episode 3 - Early 2022

Transcript 

NordStream Refilled, The Sun 24 Press Podcast, Episode 2.

(Music) 

Martin: Again, the policy, I think in the U.S., was much more relaxed and open, free markets. 

Mortymer: Sanctions started shortly after the Crimean crisis in 2014. A lot of them were focused on energy and technology transfers to Russia. Nord Stream 1 became operational and was delivering a lot of gas to Europe. Concerning Nord Stream 2, yes, Trump first sanctioned it. He seen it as a risk. He noticed that it will bring too high dependency for Europe to one supplier and wanted to avoid that. He also wanted Europe to use different suppliers, that means basically Middle East and United States. 

Martin: So sanctions were starting to kick in. When you look at the details, how one would implement these sanctions, how would one do it? I assume there's a cooperation behind the Nord Stream pipeline ? 

Mortymer: Nord Stream 2 AGs are international companies which are incorporated in Switzerland. Switzerland is a neutral place, neutral country, where a lot of similar projects are incorporated. Nord Stream 1 is 51% owned by Gazprom, which itself is a majority owned by a Russian state. So it is not just a Russian pipeline. 49% is actually owned by companies from Germany, Netherlands and France. They together built with Russian counterparts and a lot of suppliers in the pipeline. They were delivering a lot of technology, including the turbines. 

Martin: What was the response of the German government to those sanctions, imposed or created with much more pressure than in the Obama years before by the Trump administration? 

Mortymer: Germany has been consistently saying that pipelines, the key infrastructure is private business and it is not political. They have tried to keep it out of the politics. They succeeded until the relations between Russia and the Western countries were getting worse and worse. Later Angela Merkel made a conditional proposal, which was agreed with American counterparties, that if Russia enters Ukraine, Nord Stream 2 will not get its security clearance. 

Martin: Maybe it's important to mention that at that time Ukraine elected a new president. I remember some really weird, strange encounters that he had, and he flew over to Washington DC to meet Donald Trump. And after this first ever meeting of the two, there was a strange impeachment procedure initiated against Donald Trump right after a phone call that the then president had with Zelensky over certain issues regarding a company called CrowdStrike. We should not cover that, that would be another podcast, I guess. I post a link to some more information for people that are interested in this topic. Now, the Ukraine is a world in its own, in itself, and it's a pretty much split country. The Western side is ethnically different than the Eastern side. There was always an independence movements in the Eastern regions of Ukraine, which refused to speak the language Ukrainian. They feel much more connected to Russia. Parts of them refused to accept the Kiev government. It's surprising somehow to me that back in 2018-19, when Trump was in his first four year presidency, suddenly Ukraine was also used as a leverage to end those gas pipelines, isn't it? Can one say it that way? Or is it overestimated? 

Mortymer: The German government and in general, the Western governments wanted to preserve the transport through Ukraine. And it has been agreed that until 2025, the gas will be flowing through Ukraine. It will not be shifted to the Nord Stream 2 pipelines. 

Martin: Now the first really aggressive statements, as far as I remember, that I heard publicly from the US was during a US Senate committee hearing by a senator called Ron Johnson in December 2021, who had another very important person, the one responsible for US national policy in all of Eastern Europe, and especially Ukraine, Victoria Nuland, being questioned in the US Senate committee. Mr. Johnson, Ron Johnson clearly stated, while being broadcasted live on TV, that he would have the intention to quote, ending Nord Stream 2 permanently. So he was really aggressive in his speech. And maybe we should take a quick listen of what he stated in the US Senate committee.

Ron Johnson: So again, direct impact is one thing, but I'm literally talking about rolling back the pipeline, loosely define that, but I mean, taking action that will prevent it from ever becoming operational. 

Victoria Nuland: I think if President Putin moves on Ukraine, our expectation is that the pipeline will be suspended. 

Martin: So we just listened to the words of Ron Johnson. Was that the first time we actually saw aggressive statements coming out of the Anglo American world for the first time? Or were there more before even? 

Mortymer: There are always people who are aligned with different businesses and they propose their own interests. But in general, the United States is pursuing their own strategy. Some other countries are also pursuing their own sovereign strategies. Let's say, for example, Poland didn't like the project very much. Ukraine also sensed that if the gas will be shifted through the Baltic transmission pipeline, then they are going to lose a lot. I think somebody said like 2% of Ukrainian budget per year. The United Kingdom also didn't like the project. One proposal was to extend the pipeline all the way to United Kingdom, but it never happened. 

Martin: Were there any statements by, for example, Boris Johnson, even before Ron Johnson's statements in the US Senate committee? 

Mortymer: Representatives from different countries, let's say from Poland, from Ukraine, and those which would lose the transport fees were very strongly against the project. The voices from Great Britain against the Nord Stream started to be more stronger after the Salisbury attack. We all know, the Novichok attack in Salisbury. I don't want even to speculate about it, but it had a certain effect. It put the opinion about Russia and Germany that we should not cooperate together so strongly because they are not a fair actor. So Boris Johnson's government and the representatives of the United Kingdom were openly stating that Germany should not continue pursuing this project, that there are implications that extend beyond of what is Germany's economic self-interest. Germany wanted to continue, but it was under pressure. It was noted that if the Nord Stream 2 becomes operational, these interconnectors will be utilized by Gazprom. It will be harder to stop, and that would create a very strong dependency. Economical ties between Germany and Russia will be growing in time stronger and stronger, something what the United States and Britain were both against. The United Kingdom was studying the case, and indeed, there is one evidence, for example, from the debate between John Whittingdale and James Heaby from July 2018, where it's mentioned that Ukraine could lose actually 4% of its DPG, about $2.3 billion a year, which is a big amount. Boris Johnson knew the political risks involved for its own country of this large-scale energy project, and he stated, my primary concern is not the potential commercial losses of those private companies or even success or lack of success of the former German counselors in their deal-making, but the strategic interests of the United Kingdom and our friends and allies. He acknowledged that these British interests are at stake, and acknowledged that Russia will also be quite dependent on the income. It will be a good deal not just for Germany, but also for Russia. 

Martin: Now, when was the statement exactly? 

Mortymer: In July 2018, 17th of July. 

Martin: And after that, we saw more like these ?

Mortymer: Yes, incrementally, the rhetorics increased. For example, in April 2020, there was this statement that terminating Nord Stream 2 is exactly what the German government should do on its own interest and in the interest of wider alliance. Basically, he was pushing Germany for not continuing. Next example is the 4th of September 2020, there were calls to Germany to halt the Nord Stream 2 pipeline after Putin's opponent has been poisoned. Angela Merkel ruled out halting the work on the Nord Stream 2 over the poisoning, and she said that: "Our opinion is that Nord Stream 2 should be completed", she said, "I don't think it is appropriate to link this business-operated project with the Navalny question".

Martin: There were quite a few messages coming out from these various transatlantic organizations as well, way before Ron Johnson's statement in the US Senate committee, and even months and almost years before Russia invaded. 

Mortymer: There were studies from Heritage Foundation, etc., about a threat to transatlantic security, how building of the pipeline will endanger their interests. So that was in June 2021, the Heritage Foundation statements. 

Martin: Ukraine, Zelensky kicked in, whether he was driven to do it or did it voluntarily, I think that's still on the plane and shouldn't be covered by this podcast, but there was some more drastic statements coming even out from the UK. So Boris Johnson repeatedly told again and again that we're gonna end it with all measures that we have, right? Is that correct? 

Mortymer: Correct, but at that point, and still before Brexit, United Kingdom tried to stop the project legally through European Union measures. There were cases against it. In May 2021, Joe Biden states that he acknowledged that it is too late for sanctions to stop the pipeline, and so he makes a deal with Angela Merkel that it can continue for the good relations between Germany and the United States, but under the condition that if Russia enters Ukraine, then the pipeline will be stopped. And the way it has been told is that it will not get its security clearance, and without that clearance, it cannot be put into the operation. If Germany doesn't give the security clearance, it means that sometime in the future that could change. The pipeline's minimal life expectancy is 50 plus years, and we know that the return on investment is about seven years. So if Russia just like leaves it dormant, pauses it, and then opens it later, they will surely profit later. Sanctions were not working, the pipelines were almost done, but Germany and USA agreed about a soft stop if Russia goes into the Ukraine. Then it happened. There were some factions in the United States who wanted a permanent end. 

Martin: A permanent end for what? Only Nord Stream ? 

Mortymer: For the Nord Stream 2. They've never spoken about Nord Stream 1, actually. For the US government, they were very strongly against Nord Stream 2. 

Martin: Now again, there were some statements coming from the UK in this regard as well ?

Mortymer: United Kingdom actually wanted to end both pipelines, Nord Stream 1 and Nord Stream 2. Nord Stream 1 at that time was very important for a German industry and German economy. It was very well delivering on the contracts, and Russia has been, through Nord Stream 2, a very reliable supplier. 

Martin: Maybe it's important also to mention for audience that Brexit had a role in the UK being more and more aggressive towards ending Nord Stream 2. 

Mortymer: In 2020, United Kingdom started to redefine its energy policy, and it was important because they got some transition until January 2021, when UK officially left the energy market. They participate in a so-called market coupling mechanism, which helps trading of electricity with other member states, and without access to the joint energy market, the UK basically could not develop more solar and wind energy. Boris Johnson's dream was that the United Kingdom would become Saudi Arabia of the wind, but without automatic access of and selling of the excess wind energy to Europe, that would not be possible. The United Kingdom has been for 44 years a net energy importer, and their Nord Sea resources were depleting. It was a long time ago since they found some big reservoir, and they were running out of cheaper gas and oil. 

Martin: Brexit happened in January of 2020, and that was still the time when the US President Donald Trump was in charge. From my view, from my helicopter view right now, it seems that the energy policies and the conflicts that we had, the supply from Russia towards Europe, may have had a much bigger role in Brexit than initially thought. The German elections were at the end of 2021, coinciding exactly almost with the statements that we heard from Ron Johnson in the US Senate committee. The formation of the coalition itself was really surprising. We had, in Germany, a very strong influence of the Green Party, we had the Social Democrats Party, Chancellor Olaf Scholz, his party, and we had a third party: they are considered liberal policies. All these three political parties formed a so-called traffic light coalition, reflecting the colors of their political party. And we saw ,hence, at the exact same time that we heard harsh words coming from the US, in the month before coming harsh words out of the UK, more and more towards military drills, towards military operational wordings, we suddenly encountered and were confronted in Germany with a very green energy transition coalition, because the Greens made sure that a full fledged energy transition to renewables was implemented and legally binded, written down in contracts. And these coalition contracts were part of their agenda. So a tremendous shift for the decades long energy policy of receiving inexpensive energy from Russia, from other external exporters, also from the US of course, at that time already, but Russia being more dominant factor. Suddenly there was this radical shift towards entirely renewable, all solar wind, whatever green energy transition that was on the plate from day one. And even I heard Boris Johnson also tuned into these green energy mix policy ?

Mortymer: In November and December, there were some Nord Stream 2 pipeline statements, like: "A choice is shortly coming for Europe between consuming more Russian fossil fuels and sticking up for Ukraine". It's 18th of November, two and a half months before the war starts. While the United States at this point is specifically against Nord Stream 2, the United Kingdom tries to shift its rhetoric against both pipelines and especially against Russian hydrocarbons in general, not in particular on Nord Stream 2 only, but in general. They are saying Russia is not a reliable supplier, which was not true at the time. They were providing gas through pipelines on long-term contracts. Pipe-gas contracts are done normally for 10, 20, 25 years forward. We have a different pricing, but piped gas is in general faster, cheaper, and more reliable, because you get continuous flow of energy and businesses can have some visibility to the future. If you switch to LNG and spot contracts, meaning that you set a price at the moment when it's required, it can be okay, for example, in the summer when the prices go down, but when it is needed, everybody runs to buy and then the prices can go very high. You can end up by not getting LNG when you need it the most. So we are running this kind of risk. Pipeline gas in general, if you want to have it as a part of the energy mix, is traditionally a reliable source of energy. 

Martin: Despite all the things that you mentioned, there was suddenly this radical shift in the German government towards a renewable, rather pricey energy industry and economy-based sphere. One cannot emphasize more on this tremendous change in policy that we saw with the coalition formation, within the German government, Olaf Scholz being elected the head of it by the Greens, by the Social Democrats, and the Liberals in Germany. Which may have also had an impact on what we saw in the coming month. So, I'm talking two months in particular into the chancellery of Olaf Scholz, which is February 2022. Things started to ignite in the Ukraine.

(Music)

Speaker:
Mortymer - NordStream expert investigator
Martin - Investigative lead at Sun24 Press

Organization and realization:
Sun24 Press

NordStream Refilled

Episode 2

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