BERLIN (Reuters) – The United States has informed Germany that it plans to impose sanctions on a Russian pipeline laying vessel involved in the construction of the Russia-led Nord Stream 2 gas pipeline from Russia to Germany, the German Economy Ministry said on Monday.
“We record the announcement with regret,” said a spokesman for the Ministry of Economy in Berlin.
German business daily Handelsblatt previously reported US sanctions will take effect on Tuesday as part of the Act Against America’s Enemies Through Sanctions (CAATSA).
It said sanctions would be imposed on the Russian pipeline laying ship “Fortuna” and its owner, KVT-RUS.
Nord Stream 2, designed to double the capacity of the existing Nord Stream subsea gas pipeline, will pass through Ukraine, eliminating lucrative transit costs. The project has become a point of contention between Moscow and Washington, with the United States seeking to cut Europe’s dependence on Russian energy.
The group behind the pipeline suspended work in December 2019 due to threats of sanctions from Washington, even though the project was nearing completion.
Germany and European allies accuse Washington of using the newly introduced CAATSA sanctions regime to interfere with their foreign and energy policies.
According to Refinitiv ship tracking data, Fortuna is still anchored in the Baltic Sea near Rostock in northern Germany.
A spokesman for the US embassy in Berlin told Handelsblatt that Washington would continue to take “all necessary and appropriate steps” to prevent Nord Stream 2.
“Although we do not comment on future sanctions measures, we will continue to exchange ideas with allies and partners on potential sanctions issues,” the spokesman said.
The US government hopes Germany will reconsider its position on Nord Stream 2, he added.
The US State Department said it was not reviewing possible sanctions action and the Treasury Department did not immediately respond to a request for comment.
A German government spokesman told reporters earlier on Monday that Berlin’s view of the pipeline remains unchanged, namely that Nord Stream 2 is a private sector project.
Russia’s state-owned gas giant Gazprom is implementing the project together with Western partners Uniper, Wintershall, Engie, OMV and Shell.
US President-elect Joe Biden has opposed Nord Stream 2 in the past, but it is unclear if he can compromise on the issue after taking office on Wednesday.
Handelsblatt quoted a spokesperson for Nord Stream 2 as saying that it is up to the European Union and governments in the countries involved to protect the company from any sanctions.
Gazprom declined to comment and Nord Stream 2 could not immediately be reached for comment. KVT-RUS could not be reached for comment.
Reporting by Michael Nienaber; Additional reporting by Timothy Gardner in Washington and Vladimir Soldatkin in Moscow; Edited by Maria Sheahan, Peter Graff and Catherine Evans