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UPDATE 2-Polish anti-monopoly office says Nord Stream 2 threatens competition
July 22, 2016 / 11:11 AM / a year ago

UPDATE 2-Polish anti-monopoly office says Nord Stream 2 threatens competition

(Adds Gazprom’s comments)

WARSAW, July 22 (Reuters) - Poland’s anti-monopoly watchdog (UOKiK) said on Friday that a planned joint venture by Russia’s Gazprom and five European companies to build the Nord Stream 2 gas pipeline could undermine local competition.

Gazprom and its European partners, E.ON, Wintershall, Shell, OMV and Engie , agreed the Nord Stream 2 project, which would pump Russian gas to Germany, last year.

In December 2015 they sent a filing to UOKiK requesting clearance of the joint venture.

“The Office found that the concentration might lead to restriction of competition,” UOKiK’s statement said.

“At the moment Gazprom has a dominant position with respect to transmission of gas to Poland, and the planned transaction could further strengthen the company’s negotiating position with regard to users in Poland,” it added.

UOKiK’s statement is a step in its review procedure and it said its objections did not pre-judge its final decision.

Gazprom said that the Nord Stream 2 shareholders were preparing a statement.

“The decision of Poland’s anti-monopoly regulator cannot be accepted before the final deadline, set by the law, for the preparation of the response to the statement of objections,” Gazprom said in a statement.

The companies involved have two weeks to present their views on UOKiK’s objections, and they can ask to extend this period by a further two weeks, an extension which they have already requested.

UOKiK’s final decision - approval, ban, or approval with conditions - is expected by the end of this year.

Gazprom sends gas to Germany across the Baltic Sea via the Nord Stream twin subsea pipelines. The proposed Nord Stream-2 project would add a second twin pipeline across the Baltic, doubling capacity to 110 billion cubic metres (bcm) per year.

Central and east European countries and the United States have said the pipeline could limit supply routes and reduce the energy security of the EU, which gets a third of its gas from Russia.

Poland, which imports most of its gas from Gazprom, has repeatedly voiced objections to Nord Stream 2.

In June, Polish Prime Minister Beata Szydlo told German Chancellor Angela Merkel that Warsaw is concerned about the plan.

The project embodies the worst fears of Polish conservatives who see pacts between Poland’s powerful neighbours, Germany and Russia, as an existential threat.

The European authorities have opposed the pipeline expansion as Europe seeks to diversify its energy sources away from Russia amid political tension exacerbated by Moscow’s role in the Ukrainian crisis.

According to a letter seen by Reuters, European Commission President Jean-Claude Juncker said the outcry over Russia’s plan to double its gas pipeline to Germany went beyond legal issues as the project would alter the EU’s gas market landscape. (Reporting by Agnieszka Barteczko; additional reporting by Vladimir Soldatkin; editing by Adrian Croft)

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