US pushes for Nord Stream 2 sanctions

An agreement has been reached between the US House and the Senate armed services committee on a defence bill that would push the Trump White House to place sanctions on companies that are working with Gazprom, Russia's state-owned gas company.

US lawmakers came to an agreement on the 2020 National Defense Authorization Act earlier this week. The bill includes measures to punish companies involved in the completion of the Baltic natural gas pipeline from Russia to Germany, Nord Stream 2, as well as TurkStream, the pipeline that crosses the Black Sea from Russia to Turkey.

The bill, which was passed by Congress on Wednesday and is soon to go through the Senate, is seen as the latest attempt to punish Moscow for perceived interference in the 2016 US presidential election.

Democrat senator Jeanne Shaheen, who co-sponsored the bill said that it would send “an unmistakable, bipartisan message from Congress to Vladimir Putin that the US will not sit idly by while the Kremlin seeks to further spread its malign influence”.

Republican co-sponsor Ted Cruz, who ran against Donald Trump in the race to be his party's presidential nominee in 2016, added that the bill would prevent “Putin from leveraging billions of dollars that could be used to fuel Russian aggression”.

“I have heard no good arguments from the administration against imposing these sanctions. It makes no sense whatsoever that we’re failing to act and act swiftly. The window is nearly closed. We have maybe 60 days until this pipeline is completed,” he added.

President Trump has often publicly criticised Germany over the pipeline saying that it would increase Europe's reliance on Russia for its energy supply, but has stopped short of blaming Mr Putin for meddling in the election.

The sanctions threat comes as Nord Stream 2 nears its completion. Denmark gave its much delayed permission for the pipeline to be built in its waters in October, clearing a last hurdle for the project which is now 80% complete.

Opponents of Nord Stream 2, which include Poland and the Baltic states, see it as an attempt by Moscow to damage Ukraine by cutting the gas flows through the country and thereby cutting transit fees - an important source of revenue for Kyiv. They have also expressed concern about the idea of a Russian monopoly on energy being used as a political tool by Moscow. Both Gazprom and the Kremlin have repeatedly insisted that the pipeline is a purely commercial venture.

Following the approval by Denmark, Gazprom said that the remaining 140 km (87 miles) could be completed within five weeks. Russia’s Deputy Prime Minister Dmitry Kozak said last month that it is expected that the pipeline will be on stream by mid-2020.

Experts say that the potential US sanctions could further delay the process, calling into question the financial support from five EU energy companies, which are providing almost half the funding, as well as complicating the use of foreign engineering firms.

The sanctions could also strongarm Gazprom into using Ukraine to transit greater volumes of gas for a longer period of time. At present, the Russian gas supplier's contract with its Ukranian counterpart Naftogaz is due to expire on December 31.

Neither Gazprom, nor Moscow have made any official comment on the sanctions.

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