fb-pixel Skip to main content

US, Germany seal deal on contentious Russian gas pipeline

Filter separators at the Gazprom PJSC Slavyanskaya compressor station, the starting point of the Nord Stream 2 gas pipeline, in Ust-Luga, Russia.
Filter separators at the Gazprom PJSC Slavyanskaya compressor station, the starting point of the Nord Stream 2 gas pipeline, in Ust-Luga, Russia.Andrey Rudakov/Bloomberg

WASHINGTON — The United States and Germany have reached a deal that will allow the completion of a controversial Russian gas pipeline to Europe without the imposition of further US sanctions, a senior American official said Wednesday.

Under Secretary of State for Political Affairs Victoria Nuland told Congress that the two governments would shortly announce details of the pact that is intended to address US and Eastern and Central European concerns about the impact of the Nord Stream 2 project.

However, there is strong bipartisan opposition to the pipeline in Congress as well as in Ukraine and Poland, which fear Nord Stream 2 will undermine European energy security. Like the Trump administration before it, the Biden administration also opposes the pipeline but it insists that sanctions won’t stop it.

Advertisement



Nuland, the third-ranking US diplomat, told the Senate Foreign Relations Committee that the United States and Germany would release a joint statement later Wednesday regarding the pipeline. She said Washington and Berlin had committed to imposing sanctions on Russia and German companies should Moscow use the pipeline as a political weapon.

Nuland did not elaborate, although congressional aides briefed on the outlines of the deal said Tuesday it would allow the completion of the Nord Stream 2 pipeline without either Germany or Russia facing new sanctions. In return, the United States and Germany will make certain concessions to Ukraine and Poland, they said.

Nuland categorically denied reports that Ukraine had been warned against publicly complaining about the agreement and noted that the State Department’s counselor, Derek Chollet, was visiting both Kyiv and Warsaw this week to inform them of the deal. Also Wednesday, the White House announced that President Biden would welcome Ukrainian President Volodymyr Zelenskyy to the White House on Aug. 31.

“The visit will affirm the United States’ unwavering support for Ukraine’s sovereignty and territorial integrity in the face of Russia’s ongoing aggression in the Donbas and Crimea, our close cooperation on energy security, and our backing for President Zelenskyy’s efforts to tackle corruption and implement a reform agenda based on our shared democratic values,” the White House said in a statement.

Advertisement



The Nord Stream 2 project has posed a major foreign policy dilemma for the Biden administration. US officials from both parties have long feared that it would give Russia too much power over European gas supplies, potentially shutting off gas to Russian adversaries Ukraine and Poland. But the pipeline is almost completed, and the United States has been determined to rebuild ties with Germany that were damaged during the Trump administration.

Biden’s approach to Ukraine is also a sensitive political subject. Former president Donald Trump’s attempt to pressure Zelenskyy to dig up dirt on Biden and his son led to Trump’s first impeachment. He was later acquitted by the Senate.

Nuland said the United States continues to oppose the pipeline but said Biden had waived sanctions against the German company constructing the pipeline and its top executives because the penalties would have been counterproductive.

Under the terms of the expected US-Germany agreement, Ukraine would get $50 million in green energy technology credits, a guarantee of repayment for gas transit fees it will lose by being bypassed by the pipeline through 2024, and a pledge from both Germany and the United States that sanctions will be revisited should Russia use the gas as a political weapon, according to the congressional aides.

Advertisement



In a nod to Poland, Germany will also agree to sign onto the so-called “Three Seas Initiative,” an EU and US-promoted proposal that aims to boost investment, infrastructure development, and energy security among the countries bordering the Baltic, Black, and Adriatic seas, according to the aides.