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US mulls sanctions to stop Nord Stream 2
Journal Staff Report

KYIV, Jan 13 - The US ambassador to Berlin, Richard Grenell, warned German companies of sanctions for their continued work on Russia-backed Nord Stream 2 pipeline, Deutsche Welle reported.

Grenell pointed out "a significant risk of sanctions" if the companies did not pull out of the project, Germany's Bild am Sonntag has reported.

The large pipeline is set to deliver gas from northwestern Russia to northern Germany under the Baltic Sea and effectively double the amount of gas Germany imports from the country. The route would bypass Ukraine, the main shipper of Russian gas.

Ukraine sees Nord Stream 2 as the key threat to its economy that may cut between 2.5% and 3% of its gross domestic product, according to the Ukrainian Finance Ministry.

Pavlo Klimkin, the Ukrainian Foreign Minister, said the government will seek to encourage European companies to change practice and start buying Russian gas at the border between Ukraine and Russia, and then safely ship it via Ukraine to Europe.

This would replace the current system when Russias Gazprom moves gas across Ukraine to sell it to European companies in Europe.

We are confident that future transit should be based on transparent and efficient EU regulations. This means that [Russian] gas will be purchased on the eastern border of Ukraine, the transit tariff will be calculated on the basis of the European methodology, management will be based on European standards," Klimkin said at a recent press conference in Vilnius.

The US opposes the Nord Stream 2 project over fears the gas link would tighten Russia's control of Europe's energy supply and diminish the importance of gas transit countries such as Ukraine. US companies are also keen to sell gas obtained by fracking to many European countries.

In the letter cited by Bild am Sonntag, Grenell wrote that the pipeline would make Europe dependent on Moscow and increase the threat of Russian interventions.

"We emphasize that companies involved in Russian energy exports are taking part in something that could prompt a significant risk of sanctions," the ambassador wrote.

In November, the US ambassador to the EU had warned that US President Donald Trump has "many, many other tools" to "curb and stop the project" if Berlin stayed adamant.

"We have not deployed the full set of tools yet that could significantly undermine if not outright stop the project," Ambassador Gordon Sondland said, according to the Reuters news agency. (tl/dw/ez)

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USD 25.04 25.20
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