12/17/19
The U.S. has little leverage to prevent the Nord Stream 2 gas pipeline project between Russia and Germany from being completed, two administration officials said, acknowledging the failure of a years-long effort to head off what officials believe is a threat to European security. The massive $11-billion project is just weeks away from completion and has led President Donald Trump to call Germany “a captive to Russia.” He has criticized the European Union for not doing more to diversify imports away from the nation that supplies more than a third of its gas. Senior U.S. administration officials, who asked not to be identified discussing the administration’s take on the project, said sanctions that passed Congress on Tuesday as part of a defense bill are too late to have any effect. The U.S. instead will try to impose costs on other Russian energy projects, one of the officials added. The admission is a rare concession on what had been a top foreign-policy priority for the Trump administration and highlights how European allies such as Germany have been impervious to American pressure to abandon the pipeline. It also shows how the U.S. has struggled to deter Russia from flexing its muscles on issues ranging from energy to Ukraine to election interference.
On a visit to Poland in February, Secretary of State Michael Pompeo said the Nord Stream 2 project “funnels money to Russians in ways that undermine European national security.” Trump has indicated that he’ll sign the legislation passed Tuesday. The penalties on companies building the project, led by Russian energy company Gazprom PJSC, would be effective immediately, according to a Senate Republican aide. Some 350 companies are involved in building the undersea link, most notably the Swiss company Allseas Group SA, whose ships are laying the last section of pipe in Danish waters. The last section of pipe can be completed by about Jan. 11, well before the end of the period, according to Anna Borisova, an analyst at BloombergNEF in London. Nord Stream 2 will be in a position to be commissioned between April and June 2020, after additional connection work and testing, she said. The completion of Nord Stream 2 could would bring fresh supplies of gas to Europe’s already glutted market. That would make it more difficult for the U.S. to gain a bigger foothold in shipping cargoes of liquefied natural gas by tanker into Europe.
