U.S. Senators Propose Expanding Nord Stream 2 Sanctions

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June 3, 2020

FILE PHOTO: Pipe-laying vessel Akademik Cherskiy owned by Gazprom, which Russia may use to complete construction of the Nord Stream 2 gas pipeline, is seen in a bay near the Baltic Sea port of Baltiysk, Kaliningrad region, Russia May 3, 2020. REUTERS/Vitaly Nevar/File Photo

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By Patricia Zengerle and Timothy Gardner WASHINGTON, June 3 (Reuters) – U.S. senators will announce a bill this week expanding sanctions on Russia’s Nord Stream 2, a natural gas pipeline to Germany opposed by many in Washington who say it would tighten Moscow’s political and economic grip on Europe, Senate aides said on Wednesday.

The Protecting Europe’s Energy Security Clarification Act, follows legislation signed by President Donald Trump late last year. After it became law, Swiss-Dutch company Allseas immediately halted undersea work on the pipeline, which aims to double the capacity of an existing line sending Russian gas to Germany.

Now two Russian-owned pipe-laying vessels will likely be used to finish the remaining 100 miles (160 km) of the project, led by state gas company Gazprom.

Nord Stream 2, which would send gas under the Baltic Sea, could be launched by the end of 2020 or early next year, Russian President Vladimir Putin has said.

Kremlin spokesman Dmitry Peskov said on May 28 that Moscow considered the sanctions contradictory to international law.

Many politicians and energy companies in Germany support Nord Stream 2 because the country, Europe’s biggest economy, needs steady gas supplies as it seeks to wean itself off of coal and nuclear power.

The new legislation, spearheaded by Senators Ted Cruz, a Republican, and Jeanne Shaheen, a Democrat, would expand the sanctions to include penalties on parties involved in pipe-laying activities, not just pipe laying, and on parties providing underwriting services, insurance or reinsurance for the vessels. A copy of a draft bill was seen by Reuters.

“Congress must once again take decisive action and stand in this pipeline’s path,” Shaheen said.

Cruz said the bill “makes clear those involved with vessels installing the pipeline will face crippling and immediate sanctions.”

The bill, which must be passed by both chambers of Congress and signed by Trump before becoming law, also adds sanctions on companies providing services or facilities for the vessels, including welding equipment, retrofitting or tethering of the ships.

Nord Stream 2 did not immediately respond to a request for comment.

(Reporting by Timothy Gardner and Patricia Zengerle; Editing by David Gregorio and Peter Cooney)

(c) Copyright Thomson Reuters 2019.

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