The Trump administration and Congress are racing to stop Russia from finishing the controversial Nord Stream 2 natural gas pipeline to Germany.
With bipartisan backing, Congress will pass expanded sanctions as part of its annual defense policy bill to prevent Russia from restarting the $11 billion pipeline.
The nearly completed pipeline faced a round of sanctions approved by Congress in last year’s National Defense Authorization Act, which has helped to halt construction for the past year. It is roughly 100 miles short of completion.
Construction on the underwater pipeline in the Baltic Sea is set to restart on Dec. 5, a spokesman for the project recently said. Russia is likely to stop at nothing to finish it.
But opponents intend to keep the pressure on and expect President-elect Joe Biden to continue opposition to the pipeline because of its potential to increase Europe’s reliance on Moscow.
“Even if there wasn’t already a broad consensus across Republicans and Democrats that this project has to be stopped to protect our national security, these sanctions are mandatory and will be enforced by any future administration,” Republican Sen. Ted Cruz, a lead sponsor of both sets of sanctions, told the Washington Examiner. “A pipeline that is 95% completed is zero percent operational. We should keep it that way.”
The Trump administration long lobbied against Nord Stream 2 but has been helpless to stop it. In 2018, President Trump confronted German Chancellor Angela Merkel, declaring at a NATO summit that “Germany is a captive of Russia.”
Russia is a top supplier of natural gas to Europe. The Trump administration pushed the continent to favor American natural gas after the United States became the leading producer of that fuel. Russia supplies about 35% of Europe’s gas consumption.
Merkel sees the pipeline as a commercial project that will ensure Germany’s long-term access to cheap Russian gas as it phases off coal and nuclear power. Liquefied natural gas from the U.S., which has to cross oceans, is more expensive. Merkel and other Western European leaders have also bristled at U.S. interference of its sovereignty.
Eastern European and Central European countries more dependent on Russian gas, led by Poland and the Baltic States, have supported sanctions, seeing reliance on Moscow as a vulnerability.
The sanctions passed by Congress last December primarily targeted a contractor company, Allseas Group, a Swiss firm that owned a pipe-laying vessel that at the time was the only one of its kind equipped for that project. It bailed on the pipeline the day Trump signed the sanctions.
But that did not deter Gazprom, a Russian-controlled gas company, from moving to finish the construction of Nord Stream 2. It vowed to complete the remaining 140 kilometers of the pipeline. It even sought to retrofit a pipe-laying barge it bought in 2016 as a precaution because Gazprom did not operate a ship of that capability.
The new sanctions proposed by Cruz and Republican Sens. Tom Cotton, John Barrasso, Ron Johnson, and Democratic Sen. Jeanne Shaheen are intended to disrupt the ship, Akademik Cherskiy.
The sanctions target companies that would make the needed upgrades to the vessel and businesses that would insure, test, inspect, and certify the pipeline.
Analysts say it’s unlikely the gambit will work to kill the pipeline, although the sanctions could delay its completion.
Katja Yafimava, a senior research fellow at the Oxford Institute for Energy Studies, said it’s unlikely that Gazprom and other companies behind Nord Stream 2 would have committed to restarting construction this month if it had not been confident that it possesses the necessary vessel for doing the work.
“Clearly, unlike the Swiss, Russian vessels would not be deterred by the threat of sanctions,” Yafimava told the Washington Examiner. “Russia is highly likely to be able to overcome all the hurdles that are envisaged.”
Kevin Book, managing director of the research group ClearView Energy, said he also expected that Russian companies would provide insurance without being deterred by sanctions.
“They might just not care,” Book told the Washington Examiner. “The history of sanctions is sanctioned parties looked for ways to circumvent sanctions.”
None of the pipeline’s financial backers have pulled out of the project, including Shell, which complicates efforts to block it.
Still, Nord Stream 2 is unlikely to have an ally in Biden, who analysts think will oppose the pipeline even as he seeks to rebuild relations with European allies.
As vice president for former President Barack Obama, Biden called Nord Stream 2 a “fundamentally bad deal for Europe.”
“I don’t think you will get a lot of leniency from Biden,” Book said. “Biden has little incentive to back down from the status quo because doing so plays into Republican challengers in 2022 who will say Democrats are soft on Russia. The question is: Will you get a lot of new pressure?”
