Is Germany too dependent on Russian gas? How dangerous is the German-Russian energy partnership? Will the Russians turn off the gas tap one day? Since the first gas tube deal in 1970, these questions have dominated the geopolitical debate in Europe. The German-Russian energy partnership began 52 years ago with a deal of the century. A look into the historical tube.
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| "The pipe is for you, Adenauer!" is written on the natural gas pipe. The saying can also be read as "You're done, Adenauer!" This is how Soviet workers responded to the announcement of the pipe embargo. (Photo: RIA Novosti) |
Large energy deals such as the controversial Nord Stream 2 Baltic Sea pipeline, which is to pump up to 55 billion cubic meters of gas from Russia directly to Germany every year, have already caused conflicts of interest and even serious political crises in the past. The first natural gas pipe deal between the Soviet Union and West Germany was sealed on February 1, 1970. Soviet gas flowed through tubes made in Germany. It was the birth of the German-Russian energy partnership.
Business is part of Ostpolitik
The deal of the century went well with the Ostpolitik of the then Chancellor Willy Brandt (SPD) and its change through rapprochement. However, there was a difficult history: as early as 1962, the German companies Mannesmann, Hoesch and Phoenix-Rheinrohr wanted to deliver tubes to the Soviet Union. Although the deliveries were contractually guaranteed at the time, the business was doomed to failure in the last few meters. The reason for this was a pipe embargo that former Chancellor Konrad Adenauer (CDU) announced after a decision by the NATO Council. This export ban led to a break in the regulated trade relations between the USSR and the Federal Republic, because the German economy could not fulfill an already concluded contract for political reasons. The controversial embargo was finally lifted in 1966.
It was not until 1969 that the dialogue on trade issues between Bonn and Moscow was resumed. On February 1 of the following year, the first contract in the “Tubes for Gas” series was signed. The contract involved pipe deliveries from Germany to the Soviet Union worth 1.2 billion Deutschmarks. In return, the Russian side had to pump three billion cubic meters of natural gas to Germany every year for a period of 20 years. However, because a pipeline made of German pipes first had to be built or expanded, the Soviet Union was only able to supply gas in 1973.
Barter for lack of foreign currency
Since the Soviets lacked foreign exchange, trade between East and West at the time was often based on barter deals. This also included the natural gas pipe business. The first contract, like other "tube-for-gas" deals, required interim financing so that the Soviet side could pay the tube makers for their supplies. A German bank consortium granted the Soviet Foreign Trade Bank a loan of 1.2 billion Deutschmarks for a period of twelve years.
In 1967, Moscow completed the Brotherhood pipeline, which runs from Siberia's Urengoy natural gas field to Uzhhorod in Ukraine, to supply gas to western parts of the USSR. Even then there were plans to use the line for deliveries to the Warsaw Pact countries and Western Europe. In the period from 1970 to 1973, the Transgas route was laid as an extension of the "Brotherhood" pipeline from the Ukraine through Slovakia and the Czech Republic to Austria and Germany. This is the oldest gas pipeline through which Russian gas still flows to Europe today.
Middle East oil paves the way for Russian gas
In 1972, Moscow and Bonn signed a second contract for another four billion cubic meters. Historically symbolic, Russian gas flowed to Germany for the first time in 1973, the year of the first oil crisis. Although the Organization of the Arab Petroleum Exporting States (OAPEC) did not impose an embargo on Germany, unlike the USA and the Netherlands, the shortage of oil on the market and high prices also affected the German energy supply. The oil price crisis in 1973 and the second oil price crisis in 1980 triggered by the Islamic revolution in Iran made natural gas and nuclear energy more attractive. In 1974, the third natural gas tube deal was signed. It was about another loan, one million tons of pipes and 9.5 billion cubic meters of gas annually.
In November 1981, the fourth and largest natural gas pipe business followed. Annual gas deliveries to Europe amounting to 40 billion cubic meters were agreed in the contract for a period of 20 years. A line with two strands had to be built for this. Western European and Japanese banks gave the Soviet Union a loan of ten billion Deutschmarks for a period of ten years. European and initially even US companies were involved in the project. The US company Caterpillar had received the order to supply laying tractors for pipeline construction. The rotors for the gas turbines that were required for the construction of the compressor stations came from the US giant General Electric (GE). The order to build the gas turbines went to the German AEG Kanis, the British John Brown and the Italian Nuovo Pignone.
Russian gas supplies reach critical size
With the natural gas pipe business in 1981, the share of Soviet deliveries in the German gas supply increased from 17 to 30 percent. In this context, there was a discussion about how a possible failure of Russian gas supplies could be bridged. A widespread view at the time was to compensate for lost supplies from the USSR with gas from other sources and by switching industry to other energy sources. The idea of bridging the gas tap that Moscow had turned off by increasing oil supplies was also raised. Between 1950 and 1985, however, oil in Germany was mainly imported from the Middle East, which was known for its political instability even then. Therefore, an increase in oil supplies would have made little sense.
The old new US sanctions policy
Resistance to the 1981 natural gas pipe business came from Washington. In December of that year, then-US President Ronald Reagan banned US companies from supplying equipment for the pipeline. The reason was the situation in Poland, where the government had recently imposed martial law. The real US concern was that the treaty would increase Western Europe's energy dependency on Soviet gas. Washington feared that the Soviet Union could use the gas supplies as a political lever.
Because of the embargo, Caterpillar and GE had to withdraw from the contract. Caterpillar's order was taken over by the Japanese company Komatsu.
With the gas turbines, which could not be built without GE rotors, things looked more complicated. Nevertheless, a solution was found: the French company Alsthom-Atlantique, which had a GE license for the manufacture of turbines, was able to supply the necessary parts. However, in June 1982, Reagan extended the ban to foreign licensees and subsidiaries of US companies. However, the governments of the European countries involved in the project refused to meet the US demands and are supporting their companies.
Europeans don't want to give up the business
US sanctions followed in response to the European response. But they could not prevent the construction of the pipeline. The solidarity of the European states, which did not want to give up the business under any circumstances, finally led to the lifting of the embargo. The pipeline was built, but only one with one strand instead of the planned two and with an annual capacity of 32 billion cubic meters instead of the planned 40 Ukraine runs to Germany, Europe with Russian gas.
The history of the German-Russian energy partnership shows that it has always been able to assert itself against external challenges since the lifting of the NATO pipe embargo. The possibility that the United States will continue to pursue a sanctions policy against energy deals between Germany and Russia in the future does not pose a threat to their implementation. Washington's sanctions policy is a geopolitical risk that the German and Russian sides have accepted for 52 years when it comes to new energy deals.