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    Nord Stream 2 AG heads for insolvency: press

Summary

A formal insolvency hearing in Switzerland could take place later this week, Reuters says. [image credit: Nord Stream 2 AG]

by: Callum Cyrus

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Nord Stream 2 AG heads for insolvency: press

Gazprom-controlled Nord Stream 2 AG is expected to register for insolvency under the Swiss legal framework, Reuters reported on March 1, citing sources close to the matter.

Switzerland-domiciled Nord Stream 2 AG is thought to have sought financial advice to clear certain liabilities, and a formal court hearing could take place later this week, the newswire said. The move comes after the US foreign assets control office authorised the wind-down of all US-facilitated transactions in Nord Stream 2, and imposed sanctions on any entity in which the company owns a majority interest.

With the sanction set to be introduced on March 2, Reuters believes Nord Stream 2 AG will seek insolvency before the deadline to prevent defaulting on its obligations. Nord Stream 2 AG's staff will be laid off and their contracts cancelled, the sources said. It is thought to employ more than 140 people in the Swiss city of Zug.

Construction for the $11bn project had been completed last year, and the pipeline was expected to double Germany's inbound pipeline capacity for Russian gas to around 110 bn m3/yr. Gazprom is the only owner of Nord Stream 2 AG, but Engie, OMV, Shell, Uniper and Wintershall Dea have provided the project with loans.