PALDISKI, Estonia — For most of the 20th century, the Baltic nations were dominated by the Soviet Union, its behemoth neighbor to the east. Today, almost three decades after gaining independence from Moscow, the physical remnants of that rule are still scattered across the region.
The same applies to their economies. Until recently, Estonia, Finland, Latvia and Lithuania relied 100 percent on Russian gas for their energy needs.
Now the Baltic and Nordic states are trying to break free of their dependence on Russian gas imports. Finland and Estonia are building the Balticconnector, a major new pipeline between the two countries that could bring natural gas from the United States and other nations to Finland. It will be the first pipeline into Finland that does not originate in Russia.
Similar pipelines in the region have already forced Russian energy giant Gazprom to lower its artificially high prices, but the benefits are political as well as economic. “It’s the last step to undo the Soviets’ legacy in the region,” said Emmet Tuohy, a senior research fellow at the Estonian School of Diplomacy.
At the same time, much of the rest of Europe is preparing to tie its energy future even closer to Moscow. Russia is building its own pipeline, called Nord Stream 2, that could double the amount of natural gas it exports to Germany.
That pipeline has become a flash point of European energy politics, pitting countries that need reliable supplies of Russian gas against others that see those supplies as another way for Moscow to meddle in Europe’s affairs.
For the European Union, natural gas is critical: It currently generates more than one-fourth of the E.U.'s electricity needs, which are only growing.
A third of the E.U.'s gas currently comes from Russia, and Moscow is hoping to boost its market share further. To ensure it does, Gazprom is building two new pipelines into Europe. One of them, called Turkish Stream, will serve southern European markets via Turkey and Greece. But the far more controversial project is Nord Stream 2, which ends in northern Germany and is slated to supply major Western European nations, among others.
Western European countries hope more gas trade with Russia will reduce tensions and give them common economic interests with Moscow. But Nord Stream 2′s critics fear the project will only make Europe even more dependent on Russia and vulnerable to its political whims.
Those critics have a powerful ally. The United States has pressured Germany in recent months to stop the pipeline. During his speech at the U.N. General Assembly in September, Trump claimed Germany would become “totally dependent on Russian energy if it does not immediately change course.” At one point, the White House even seriously considered levying sanctions to halt the project.
With Washington on the offensive, eastern and central European nations are feeling emboldened to ramp up their criticism. Polish President Andrzej Duda called Nord Stream 2 “a huge threat” when he visited the White House in mid-September. In the Baltics, Estonian Foreign Minister Sven Mikser voiced similar skepticism in July, saying the pipeline was “in contradiction with the principles of the E.U.'s energy policy” and warning it would give Russia leverage “to intervene in European politics.”
Many of those countries still remember the dispute between Ukraine and Russia that began in March 2005. At the time, Moscow accused Kiev of diverting gas meant for E.U. nations and redirecting it to its own storage sites, thus avoiding paying for its own energy consumption.
The dispute escalated in 2009, when Russia stopped piping gas through Ukraine to force Kiev to stop its alleged practices, which hit the nations that depend largely or completely on Russian gas hardest.
Russia and Germany concluded new pipelines were needed to avoid the fraught route through Ukraine.
Things became even more complicated in June 2014, following a pro-European revolt in Ukraine that triggered Russia’s annexation of Crimea. As Russian-backed rebels fought Ukrainian soldiers, Moscow turned up the pressure by cutting off Ukraine’s gas supplies.
European pressure on Russia eventually ended the blockade, but Ukraine and other Eastern European countries fear their Western European partners will be less inclined to help them once they receive gas through the new pipelines.
“It would increase Russia’s leverage: All of the sudden they would have another route and option to stranglehold Ukraine and to demand better transit conditions," said Nolan Theisen, head of the GLOBSEC Policy Institute’s Energy Program.
In Germany itself, Nord Stream 2 has faced mounting resistance in reaction to Russian military operations in Georgia, Ukraine and Syria.
Still, there is little chance the pressure will work. “Germany has long been among the E.U. countries with the most friendly attitudes toward Russia — but they also simply wouldn’t be able to go without Russian gas deliveries,” said Andreas Heinrich, an Eastern Europe researcher at the University of Bremen.
Can the United States compete?
Indeed, Western Europe has few alternatives. Britain, Norway and the Netherlands are Western and Northern Europe’s biggest gas producers, primarily relying on natural gas fields in the North Sea. But over the next few decades, Europe’s own resources — which accounted for more than a third of its supplies in 2016 — are expected to gradually disappear.
The supplies could be substituted either by Russian natural gas or by liquefied natural gas (LNG), which is natural gas that has been cooled down so much it becomes liquid and fits into shipping tanks. New fracking and drilling technology has already made the United States the world’s biggest natural-gas producer. It is now trying to become the top LNG exporter, as well, with Europe being its biggest potential market.
So far, 4 percent of American LNG goes to Europe, compared with 59 percent that is exported to Asian markets. That could change when the construction of six new European LNG port terminal is completed, with most of them located in former Soviet Union member states.
That is why key German business groups believe American export interests, rather than security concerns, are behind Trump’s recent attacks on Nord Stream 2.
Dieter Kempf, the president of Germany’s industrial association told the Süddeutsche Zeitung newspaper in a recent interview that LNG would likely never constitute a real alternative to Russian gas. He argued that shipping LNG across the Atlantic Ocean is too expensive — a conclusion currently shared by a number of energy experts, including Theisen. Shipping LNG across the Atlantic can take weeks and constructing the terminals where the gas would be unloaded is expensive.
“LNG and Russian gas will compete, but LNG won’t replace Russian exports,” Theisen predicted.