Gas Pipelines
Major international gas pipelines reshape geopolitics. Nord Stream 1 and 2 (Russia-Germany under Baltic) became politically charged in 2022 — Nord Stream 2 never commissioned, Nord Stream 1 sabotaged September 2022. Power of Siberia (Russia-China) has scaled rapidly post-2022. TAP brought Azerbaijani gas to Italy. Pipelines lock in 30-50 years of energy flows and political relationships.
Key insights
Nord Stream sabotage marked a strategic turning point
September 2022: explosions destroyed Nord Stream 1 and incomplete Nord Stream 2 pipelines under the Baltic. Multiple investigations have produced conflicting attributions. The sabotage ended the prospect of restoring Russia-Germany gas flows. It also signaled that major energy infrastructure is now considered a legitimate strategic target. Pipeline security has risen as priority for operators globally.
Power of Siberia is the strategic alternative for Russia
Russia and China expanded Power of Siberia 1 from initial ~5 BCM (2020) to 38 BCM (2024) target, with Power of Siberia 2 (50 BCM) in planning. China has been able to negotiate aggressive pricing as Russia has lost European market access. Russia's pivot eastward is real but not full replacement — capacity is much smaller than lost European exports.
Europe pivoted to LNG and pipeline diversification
Post-2022 Europe shifted gas imports: lost ~155 BCM/year of Russian pipeline gas, replaced ~120 BCM with LNG (US, Qatar) + ~25 BCM additional Norwegian + 5-10 BCM Azerbaijani via TAP. LNG terminal expansion has been the major infrastructure response. Europe's gas supply is now more diversified geographically but more dependent on global LNG markets with their price volatility.
Major gas pipeline capacities
Billion cubic metres per year design capacity
Key Finding: Russia-China and Central Asia-China have grown; Russia-EU pipelines have been disrupted.
EU gas supply mix 2021 vs 2024
% share of EU gas imports
Key Finding: Russian pipeline collapsed from 41% to ~8%; LNG share doubled.
Methodology & caveats
Capacity vs throughput
Pipeline design capacity is the maximum flow possible. Actual throughput is what flows. Russian flows to Europe in 2024 were ~8% of design capacity — pipelines exist but operate at fraction of capacity. Comparing 'capacity' across systems can mislead; actual throughput is the more meaningful number.
Geopolitical durability
Pipeline construction commits 30-50 years of physical infrastructure to specific trade routes. Counter-routing requires either new pipelines or LNG — both are slow and expensive. China's 5,000km Central Asia-China pipeline (2009) created 30+ year energy interdependence with Turkmenistan, Kazakhstan, Uzbekistan. Pipelines therefore both reflect and shape geopolitical alignment.
LNG vs pipeline economics
Pipeline gas typically $2-5/MMBtu transportation cost. LNG transportation: $3-5/MMBtu (liquefaction + shipping + regasification). Pipeline is cheaper per unit; LNG is more flexible (can change destinations). Long pipelines compete with LNG when distances exceed 4,000-5,000 km. The Russia-Europe pipelines were among the most economic per-unit-energy in history due to scale and proximity.