The Nord Stream 2 gas pipeline from Russia to Germany has long been a controversial project given how much power Moscow will have over Berlin once it is completed. Now, the U.S. has threatened Germany with sanctions if the country decides to move ahead with the project. The EU is also siding with the U.S. and has announced a tougher set of rules for the pipeline.
A letter by the U.S. Ambassador to Germany, Richard Grenell, stated that companies working on the Russian energy export pipeline are at risk of facing U.S. sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA). The act was passed by the United States in 2017 and mostly targets countries like North Korea, Russia, and Iran.
European companies involved in the Nord Stream 2 project include Wintershall and Uniper from Germany, Engie from France, Dutch-British Shell, and OMV from Austria. Though some accused the United States of trying to blackmail Germany into giving up on the pipeline, the U.S. embassy dismissed such claims and stated it was trying to prevent Europe from being subjected to Russian dominance.
“[The letter] is not meant to be a threat, but a clear message of U.S. policy… The only thing that could be considered blackmail in this situation would be the Kremlin having leverage over future gas supplies,” a spokesman for the American embassy in Berlin said in a statement (The Local).
Last year, U.S. President Donald Trump strongly condemned Germany over the gas pipeline project. He warned that Germany will be dependent on Russia to meet 60-70 percent of their energy demands, thereby giving Moscow significant leverage over Berlin.
“So we’re protecting Germany. We’re protecting France. We’re protecting all of these countries. And then numerous … countries go out and make a pipeline deal with Russia, where they’re paying billions of dollars into the coffers of Russia,” President Trump said in a statement (The Epoch Times).
Meanwhile, the EU has finalized a new set of rules that the proposed pipeline must comply with. If applied in full, the rules will change the operation of the project, but will not put a stop to it.
Regulations mandate that all pipelines in European territory follow a few basic energy rules. These include the transparent reporting of gas shipments, implementation of non-discriminatory tariffs, and ownership unbundling in which the pipes are not owned by those who supply the gas. New rules also require a minimum of 10 percent of the capacity to be offered to third parties. An EU member state can only make exceptions to the rules under the strict supervision of the European Commission.
The EU’s regulations come on the back of concerns of several European nations as to the security threat posed by the pipeline project. “Poland views the Nord Stream 2 as a significant threat to the peace and security on the European continent from the point of view of deepening European countries’ dependence on Russian energy and the prospects for an escalation of Russian aggression against Ukraine,” Polish Foreign Minister Jacek Czaputowicz said in a statement (Foreign Policy).
Ukraine had also declared displeasure at the project. Currently, the country charges transit fees for Russian energy exports that pass through its territory. Once Nord Stream 2 is completed, Moscow can completely bypass Ukraine, resulting in a loss of billions of dollars. Earlier, Russia used to think twice before meddling in Ukraine’s affairs since its gas shipments passed through the region. But with the new pipeline in place, Ukraine will be exposed to the Kremlin’s oppressive tactics.