Gazprom’s Nord Stream sues insurers for more than $400M over 2022 Baltic Sea pipeline blasts
Nord Stream AG is seeking more than EUR 400 million ($436m) from its insurers for refusing to cover explosions in 2022 which ruptured pipelines designed to transport Russian gas to Germany, Financial Times reported on March 12.
London’s High Court documents show the Switzerland-based company brought a lawsuit last month claiming that insurers “failed to pay” for damage done by underwater explosions that mangled and deformed the Nord Stream 1 and 2 pipelines at the bottom of the Baltic Sea.
Read also: Nearly simultaneous leaks in Nord Stream undersea gas pipelines ‘could be sabotage’
Nord Stream’s “preliminary and high-level estimate” of the costs to remove water from the pipelines and stabilize them, undertake a repair and replace lost gas is between €1.2bn ($1.31bn) and €1.35bn ($1.47), according to the legal documents.
The case is being levelled against Lloyd’s of London among insurers that provided the so-called primary policies, which take the first losses from any event. The second defendant is a group of insurers led by an arm of Bermuda-based Arch, which provided the so-called excess cover. Such policies typically kick in after the primary policies have paid out.
Nord Stream is arguing the explosions were a separate occurrence for the purposes of both sets of policies. The claim of €400m is split evenly between the primary and excess groups. The company also claimed for about €3.7m ($4.1m) for a damage survey, plus other costs.
The cause of the explosions, which took place in international waters in September 2022, has not been determined.
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Russia was initially suspected of sabotage but has denied responsibility. Ukraine also denied involvement after media reports in the US and Germany suggested pro-Ukrainian operatives may have been behind the attacks.
Both Denmark and Sweden have dropped their investigations, saying they did not have enough evidence to charge anybody, leaving only Germany at present conducting a probe.
On the night of Sept. 26, 2022, three of the four Nord Stream 1 and Nord Stream 2 gas pipelines were destroyed by explosions at the bottom of the Baltic Sea in neutral waters.
Read also: Second line of Nord Stream 2 gas pipeline probably destroyed by explosions, Germany says
Neither of the gas pipelines were in operation at the time – they were filled with pressurized methane. Supplies in Nord Stream 1 were halted by Russia after its full-scale invasion of Ukraine. Nord Stream 2 never came into operation after Germany cancelled its approval process.
Poland and Ukraine accused Russia of the bombings, while the Kremlin regime, in turn, denied any involvement and blamed the “Anglo-Saxons” (probably referring to the United States and the UK, and possibly Australia and other English-speaking nations as well).
In November 2022, the Swedish security service confirmed that explosive remnants were found near the pipelines. The Swedish prosecutor’s office believes that the investigation into the explosions could end in the fall.
Earlier, U.S. newspaper the New York Times reported, citing U.S. officials who had reviewed early U.S. intelligence and spoke on condition of anonymity, that a “pro-Ukrainian group” may be behind the sabotage of the Nord Stream pipelines.
Read also: German journalists investigate ‘new Ukrainian connections’ to Nord Stream explosions
The German media, citing sources, claimed that the yacht used by the group of alleged bombers belonged to Ukrainian citizens. The news outlets also reported that one of the men who rented the yacht lived in Ukraine.
Mykhailo Podolyak, an adviser to the head of the President’s Office, said that Ukraine had nothing to do with the destruction of the gas pipelines. Defense Minister Oleksii Reznikov said it was “a rather strange story that has nothing to do with us.”
“I am the president and I give the appropriate orders,” President Volodymyr Zelenskyy said in June, also denying that Ukraine was involved in the incident.
“Ukraine has never done anything like this. I would never do that,” Zelenskyy said.
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