Wednesday, March 21, 2018

US threatens to sanction European firms involved in Russian gas project

Nord Stream
The US State Department has issued a warning over probable penalties against corporations engaged in the construction of the Nord Stream 2 gas pipeline, claiming that the Russian project undermines energy security in Europe.

“As many people know, we oppose the Nord Stream 2 project, the US government does,” State Department spokesperson Heather Nauert said during a news briefing. “We believe that the Nord Stream 2 project would undermine Europe's overall energy security and stability. It would provide Russia [with] another tool to pressure European countries, especially countries such as Ukraine.”

The pipeline project was started in 2015 as a joint venture between Russia's Gazprom and its European partners, including France’s Engie, Austria's OMV, German Uniper and Wintershall, as well as British-Dutch multinational Royal Dutch Shell. The pipeline, running from Russia to Germany under the Baltic Sea, is set to double the existing pipeline’s capacity of 55 billion cubic meters per year.

The spokesperson said that Washington could introduce punitive measures against the participants of the energy project. The measure could be implemented by means of a provision in the Countering America’s Adversaries Through Sanctions Act (CAATSA).

“At the State Department, we have spent a lot of time speaking with our partners and allies overseas to explain to them the ramifications of CAATSA and how an individual or a company or a country can run afoul against CAATSA and fall into sanctions," she said. "We don't tend to comment on sanctions actions but we've been clear that firm steps against the Russian energy export pipeline sector could – if they engage in that kind of business – they could expose themselves to sanctions under CAATSA.”


1 comment:

  1. Building the second leg of the Russian gas pipeline running through the Baltic Sea would threaten European energy security, the U.S. government said.

    A bipartisan group of 39 senators sent a letter last week to the U.S. Treasury Department expressing opposition to Russian plans to twin the Nord Stream pipeline to Germany. If built, it would leave U.S. allies in Europe more exposed to the Kremlin's "malign influence," the letter read.

    Global energy demand is expected to increase by about 16 percent by 2030 and, even as the world's economy shifts toward renewable energy resources, oil and gas will still account for more than half of the demand. For natural gas, the global appetite swells 23 percent by 2030, beating the expected demand for crude oil.

    European markets get about 20 percent of their gas supplies from Russia. The Russian natural gas company Gazprom wants to double Nord Stream to help meet demand, though European leaders have expressed anti-trust concerns because Gazprom controls both the transit network and the supplies.

    Heather Nauert, a spokeswoman for the U.S. State Department, said any company that engages in the project could run afoul of the Countering America's Adversaries Through Sanctions Act, which imposed sanctions last year on Iran, Russia, and North Korea.


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