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Scholz Blames Russia for Nord Stream Gas Turbine Debacle

(Bloomberg) -- German Chancellor Olaf Scholz said Russia is to blame for a delay in shipping a turbine for the key Nord Stream 1 gas pipeline, and signaled extending the life of Germany’s three remaining nuclear power plants remains a potential option to help ease an energy crunch.

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The turbine, which Gazprom PJSC has cited as a reason for the reduced deliveries that are stoking Europe’s gas crisis, is ready to be reinstalled following maintenance in Canada, and there are no hurdles on Germany’s side, Scholz said Wednesday at a news conference. He was standing next to the component and alongside the chief executive officer of its manufacturer, Siemens Energy AG, in Muelheim an der Ruhr in western Germany.

“What’s important to me is to make it clear that this turbine is ready for action at any time,” Scholz said. “There is nothing preventing it from being transported to Russia.”

The German chancellor traveled to the facility in the Ruhr region, the country’s industrial heartland, amid growing tensions with Russia over sanctions and the war in Ukraine. As Moscow reduces flows through Nord Stream, Europe’s largest economy faces an energy crisis this winter that could trigger a recession and prompt the state to ration gas.

Kremlin spokesman Dmitry Peskov responded to Scholz’s comments by saying that the turbine lacks documentation proving it isn’t subject to sanctions. Gazprom also needs “papers on its technological condition,” Peskov said on a conference call with reporters.

Wolfgang Buechner, a deputy German government spokesman, dismissed Peskov’s assertion, saying no such documentation on sanctions is required. Speaking at the same regular news conference, economy ministry spokesman Stephan Haufe added that the turbines are not included in European Union sanctions.

Asked about the government’s efforts to reduce reliance on Russian gas, Scholz said Germany continues to evaluate options for the country’s three nuclear reactors that haven’t yet been shuttered as part of the exit from atomic power. He said the plants, which are due to go offline at the end of this year, won’t be able to replace gas completely in the economy as they only generate electricity. “But this can still make sense,” Scholz said.

The government has commissioned another “stress test” of the country’s energy security and potential extension of nuclear power and Scholz said the results will be published “soon.” The economy ministry has indicated it could be “in coming weeks.”

The whereabouts of the Nord Stream turbine stoked political controversy in recent weeks as Russia claimed the component is needed to sustain gas exports to Europe, while Germany described their argument as a bluff and accused Russia of weaponizing energy.

The turbine had been sent to Canada for maintenance work at the Siemens Energy factory where it was built. It got temporarily stranded because of sanctions imposed after Russia’s invasion of Ukraine, before Canada decided to allow transport to Germany.

The turbine arrived at Germany’s Cologne-Bonn airport a fortnight ago before being trucked to a Siemens Energy warehouse in the Ruhr. The turbine is based on the Rolls-Royce Plc jet engines used in the Boeing Co. 777 jet.

Gazprom has gradually reduced flows through Nord Stream, citing technical issues and missing documents for the turbine. The most recent reduction leaves the link into Germany’s north coast operating at about 20% of capacity.

Turbines installed at the Portovaya station on the Baltic coast power compressors, allowing gas to flow through the 1,200-kilometer (745-mile) subsea conduit to Germany. Each one is about 20 feet (6.1 meters) high and 15 feet wide.

When all are fully operational, Nord Stream can pump at least 55 billion cubic meters of gas a year to European consumers. In 2021, when actual volumes were even higher, it was enough to cover about 15% of the EU’s total gas needs.

“There are no technical reasons” for reducing Nord Stream flows, Scholz said. “This turbine works.”

(Updates with Russian, German government comments starting in fifth paragraph)

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