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    Berlin Discusses US Sanction Threat to Nord Stream 2


German and EU authorities are considering how to respond if the US imposes the sanctions on the Russian project.

by: Joseph Murphy

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Berlin Discusses US Sanction Threat to Nord Stream 2

The economic committee of Germany's lower house of parliament (Bundestag) held a public meeting July 1 on a bill making its way through US congress that would impose harsher sanctions on Russia's Nord Stream 2 pipeline.

The pipeline, which would carry up to 55bn m3/yr of Russian gas under the Baltic Sea to Germany, enjoys the support of the German government and most German lawmakers. But the US and some eastern European nations say the project poses a threat to EU energy security.

The US imposed a first round of sanctions against the pipeline in December, forcing Swiss contractor Allseas to halt work on the project. While these sanctions only affected pipelaying vessels, the next set will penalise any companies involved in construction. This would include companies storing pipes, providing logistics, preparing the seabed and supplying any other sort of services and equipment.

Russia's plan now is to use two of its own pipelaying vessels, stationed off the German port of Mukran, to complete the remaining 6% of Nord Stream 2's offshore section which lies in Danish waters. Russian president Vladimir Putin has said the pipeline will be ready to flow gas in early 2021.

US sanctions would "constitute a serious interference in European energy security and EU sovereignty," Germany's foreign ministry warned in a statement in early June, when the sanction bill was introduced to the US senate. On June 25, the bill was introduced at the house of representatives. It will need to be approved by both chambers and then be signed into law by US president Donald Trump.

"If the sanctions are actually enforced, neither the completion nor the commissioning of the pipeline would be possible," Timm Kehler, chairman of German gas association Zukunft Erdgas said in a statement released on June 30. "But we need new natural gas infrastructure for secure gas supply in Europe."

Kehler estimates that over 120 companies from more than 12 European countries would be directly affected by the sanctions.

The European Commission is also weighing up a response to the US measures, its foreign policy chief Josep Borrell told Reuters on June 29. 

"The EU’s position on US sanctions against European companies that carry out legitimate and lawful activities under European law is unequivocal," he told the news agency. "They are unacceptable and contrary to international law, and the Union firmly opposes them."

The sanctions would undermine the EU and the US's united front against Russian activities in Ukraine. The two parties  introduced sanctions against Russia together in early 2014 after Moscow annexed the Crimean peninsula from Ukraine.