The US State Department this month told European companies it suspects of helping build Russia’s Nord Stream 2 pipeline that they are at risk of sanctions as the outgoing Trump administration prepares a final round punitive measures against the project, two sources said Tuesday. .
“We are trying to educate companies about the risk and urge them to pull out before it is too late,” a US government source said on condition of anonymity.
The US source said the State Department is expected to release a report by Thursday or Friday on companies it says are helping the Russia-Germany pipeline. Companies that could be included in the report include those that provide insurance, help lay the subsea pipeline or check the project’s construction equipment, the source said.
Companies could be exposed to US sanctions under applicable law if they do not stop working.
Zurich Insurance Group could be listed in the report, the source said. The company did not immediately respond to a request for comment.
(Zurich has since issued a statement: “Zurich has a comprehensive compliance framework in place and is committed to fully complying with all applicable sanctions regulations. We do not comment on specific customer relationships.”)
Nord Stream 2 did not immediately respond to a request for comment.
The $ 11 billion pipeline, one of Russia’s biggest projects in Europe, has sparked tensions between Washington and Moscow.
The Trump administration opposes Nord Stream 2, which would deprive Ukraine of lucrative transit fees, saying it would increase Russia’s economic and political influence over Europe. The administration has also pushed exports of US liquefied natural gas to Europe, a fuel that competes with Russian pipeline gas.
The Kremlin says Nord Stream 2, run by state-owned energy company Gazprom, is a commercial project.
Germany, Europe’s largest economy, also claims the pipeline is simply commercial. It needs gas because it shuts down coal and nuclear power plants for environmental and safety reasons.
US President-elect Joe Biden opposed the project when he was Barack Obama’s vice-president. It is not certain that he would be ready to compromise on the project after January 20, when he will take over.
Gazprom halted construction of Nord Stream 2 for a year after US sanctions in December 2019. But work has resumed as Gazprom hopes to complete the Nord Stream 2 pipeline under the Baltic Sea to double the capacity of the existing line. The project is 90% complete with only a 62 mile (100 km) deep water section off Denmark to be completed.
Western partners of Gazprom in the project are German Uniper, Wintershall Dea of BASF, Anglo-Dutch oil company Shell, Austria OMV and Engie.
A US-based industry source who saw the State Department’s communications said European companies, including German companies, had received inquiries from the Trump administration in recent months , going back to October, about their activities related to Nord Stream 2.
The State Department asked the companies in October if they were involved in Nord Stream 2 and if any work continued after July 15, as well as the value of the services or support.
On that date, US Secretary of State Mike Pompeo warned investors in Russia’s Nord Stream 2 and Turkstream pipelines that they could face penalties under the Countering America’s Adversaries Through Sanctions Act of 2017.
On Jan. 1, the State Department again made an urgent request, the industry source said, asking to set up an appeal this weekend with the Bureau of Energy Resources to discuss details of the liquidation activities. enterprises.
The State Department did not immediately respond to a request for comment.
(Reporting by Daphne Psaledakis and Timothy Gardner; writing by Timothy Gardner; editing by Kim Coghill)
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