Germany: outgoing US-Ambassador Grenell announces new sanctions against Nord Stream 2

US-ambassador to Germany Richard Grenell who unexpectedly terminated his appointment last week announces new sanctions against the Nord Stream 2- pipeline and warns Germany to reconsider its relationship to Russia, writes Handeslblatt:

"In the usual undiplomatic tone, Grenell calls on the federal government to fundamentally rethink its policy on Russia. "Germany has to stop feeding the beast while not paying enough for NATO," he told the Handelsblatt. Grenell had already left Berlin on Sunday. He will probably never come back to Germany.

The Americans have long been bothered by German imports of Russian gas. Above all, they fought the Nord Stream 2 Baltic Sea pipeline with a determination that had long been underestimated in the federal government. At the end of last year, the USA managed to force a construction freeze. Your means: threats of sanctions against western specialist companies who lay the pipes on the bottom of the Baltic Sea with their ships. Since then, the Russians have been trying to complete the rest of the pipeline themselves. To do this, they moved two ships to German coastal waters."

You can read the rest of the piece via the below link:

https://www.handelsblatt.com/politik/international/ostseepipeline-abschiedsgruss-von-us-botschafter-grenell-neue-drohung-gegen-nord-stream-2/25861262.html?ticket=ST-3507167-W9CwymPcLF6wv6FqTJ4F-ap4 

Nordstream 2: no replacement for pipelaying company Allseas in sight yet

The menace with severe sanctions did not fail it's effect with the pipelaying company Allseas that layed the pipes for the Nordstream 2 pipeline.

Allseas immediately terminated the operations after the sanctions were pronounced.
Although the consortium of Nordstream 2 was confident to resume the works so far no replacement has been found to complete the outstanding 150 km, writes german newspaper "Handeslblatt":

"In the first days after the sanctions against Allseas, the supporters of the project were still confident. The trade penalties are an obstacle, yes, maybe a price driver, but could ultimately be avoided. "The project has progressed so far that ways and means will be found to let the sanctions run out of steam," said an industry representative in December.

In the meantime, pipeline supporters have become more reserved. Even Russian President Vladimir Putin, who otherwise likes to show off his energy, is cautious. When he went to the press with Chancellor Angela Merkel in Moscow in the second week of January, he did not want to commit to an appointment. "I hope that the work will be completed by the end of the current year or in the first quarter of next year and that the gas pipeline will be put into operation," said Putin.

The uncompromising harshness with which the Americans go to work has surprised everyone: the managers of Nord Stream 2 AG as well as the governments in Berlin and Moscow. Actually, as is common in such cases, the US Congress Sanctions Act provided for a transition period. 

It should be 30 days. That would probably have been enough to complete the pipeline. But Cruz made it clear in his letter that the economic penalties against the laying companies would apply immediately. The Americans did not even act so brutally against Iran.

The targeted sanctioning of Allseas proves to be a smart move. Allseas has special technical skills for which the company is envied all over the world. With its ships, the huge "Pioneering Spirit" and the somewhat smaller "Solitaire", it is able to lay pipeline pipes at great depths and in difficult weather conditions. Replacing these skills is not easy.

The Russians still want to try and convert their own ships. The most likely candidate to move the last few kilometers is the “Akademik Cherskiy”, a Russian layaway ship completed in 2015 that meets the requirements required in Danish waters. According to media reports, the "Akademik Cherskiy" was most recently in the Far East of Russia near Vladivostok.

According to experts, the trip to the Baltic Sea alone would take up to two months. According to experts, the Russian laying ship "Fortuna", which can be seen in the port of Mukran on Rügen these days, is only suitable for laying pipes in shallow water or near the coast - and is therefore a non-void candidate."

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Nord Stream 2: sanctions are in effect

As anticipated, U.S. President Donald Trump signed off on legislation allowing Washington to issue sanctions on firms involved in the €10 billion pipeline.

Swiss-dutch pipelaying-company Allseas has immediately stopped their activities on Nord Stream 2 after the entry into force of the sanctions explaining: "Allseas will proceed, consistent with the legislation’s wind down provision and expect guidance comprising of the necessary regulatory, technical and environmental clarifications from the relevant US authority."

To german government spokeswoman Ulrike Demmer the sanctions "hit german and european companies" [n.b. no german company is designated by the sanctions], and "constitute an interference in [our] internal affairs".

U.S. ambassador to Germany, Richard Grenell, views the sanctions as deeply pro-European.


See more information here:

https://www.bild.de/politik/trump/politik-ausland/donald-trump-unterzeichnet-gesetzespaket-gegen-nord-stream-2-66855030.bild.html

https://www.politico.eu/article/nord-stream-2-russia-sanctions-us-donald-trump/

Can US sanctions still stop Nord Stream 2?

According to sources of german newspaper Bild, the US Senate plans sanctions against companies participating in or are involved in the construction of the Nord Stream 2 pipeline.
Primarily this would affect swiss company Allseas that is specialised in submarine pipelaying and deep-sea-cable-laying.
But also german energy groups like Uniper. 
Those companies would be excluded from the US market if they persist in their activity for Nord Stream 2 and should the sanctions effectively be voted.

Interestingly, the sanctions might be voted as part of the National Defense Authorization Act.

The US Congress takes the view that Nord Stream 2 increases the dependency of Germany and Europe from russian gas, that it jeopardises ukrainian security interests and drives a wedge between  E.U.-member states. The EU Commission and most member states oppose the construction of the highly controversial pipeline. Only Germany and Austria are staunch supporters of the project.

Nord Stream 2: US congress hits pipe-laying companies

Foreign Policy describes the balancing act of US administration to impede russian dominated Nord Stream 2 pipeline and preserve a productive relationship with german and other european governments:

"The threat of sanctions is now more pronounced. Two bills in the House and the Senate, instead of penalizing the major gas companies involved, would target a perceived weak link: the specialized pipe-laying companies working on Nord Stream 2 (and on the Russian state-controlled gas company Gazprom’s TurkStream project, which will bring Russian gas across the Black Sea to Turkey and eventually to Europe). The bills would sanction pipe-laying companies involved in the project, freezing their U.S. assets and prohibiting them from doing U.S. business.  Only a handful of companies possess the pipe-laying technology Nord Stream 2 needs, and they are in high demand worldwide. One of them, the Swiss-based contractor Allseas—which is heavily exposed to the U.S. dollar and U.S. business—is essential to completing the pipeline, and the proposed sanctions could cause the company to withdraw. The bills have bipartisan support: The Senate Foreign Relations Committee passed the bill by a vote of 20 to two at the end of July, after the House version passed the House Foreign Affairs Committee with similar bipartisan approval. The bills’ widespread support across parties and chambers increases their likelihood of passing with a veto-proof majority, which could kill the pipeline or delay its completion by years."

(...)

"Since 2014, Germany has been the linchpin for sustaining EU sanctions against Russia for its aggression in Ukraine. Increasingly, countries such as Italy, Greece, and Hungary express a desire to end the sanctions, but Berlin has held the EU together. It is risky for the United States to subject Germany to increased political pressure on Nord Stream 2 at a time when solidarity on the more comprehensive sanctions effort is eroding. It would add to a growing list of U.S.-German tensions, including  U.S. tariffs on European aluminum and steel, U.S. demands that Germany increase its defense spending, the consequences of U.S. withdrawal over the Iran nuclear deal, and the question of how best to respond to China’s growing international economic role and the influence of its technology companies worldwide. It is hard to imagine a German government going out on a limb on other U.S. requests—whether for German participation in a maritime escort mission in the Persian Gulf or for German ground troop commitments in Syria—while Washington is sanctioning German companies over Nord Stream 2."

You can read the rest of the piece via the below link:

https://foreignpolicy.com/2019/09/02/maximum-pressure-on-germany-is-a-big-mistake/