State Dept. to scrap sanctions on firm behind Russian pipeline to Germany

The Biden administration will soon waive sanctions on the Russian-owned corporation behind construction of a controversial natural gas pipeline linking Russia and Germany, according to a new report.

Axios, citing two sources briefed on the decision, said that the State Department will acknowledge to Congress that the company, Switzerland-based Nord Stream 2 AG, and CEO Matthias Warnig are engaged in sanctionable activity. However, the report adds, the department will not apply the sanctions due to US national interests.

Reached for comment by The Post, a State Department Spokesperson said it is continuing to “examine entities involved in potentially sanctionable activity and have made it clear that companies risk sanctions if they are involved in Nord Stream 2,” without directly addressing the report.

“The Biden Administration has been clear that the Nord Stream 2 pipeline is a Russian geopolitical project that threatens European energy security and that of Ukraine and eastern flank NATO Allies and partners. We continue to examine entities involved in potentially sanctionable activity and have made it clear that companies risk sanctions if they are involved in Nord Stream 2. We will continue to underscore U.S. strong, bipartisan opposition to this Russian malign influence project.”

Waiving sanctions against Nord Stream 2 AG and Warnig — a former East German Stasi officer with close ties to Russian President Vladimir Putin — would represent a significant concession from Biden and Secretary of State Antony Blinken. On March 18, Blinken called the Nord Stream 2 pipeline “a Russian geopolitical project intended to divide Europe and weaken European energy security.”

“As the President has said, Nord Stream 2 is a bad deal — for Germany, for Ukraine, and for our Central and Eastern European allies and partners,” Blinken said in a statement at the time, later warning that “any entity involved in the Nord Stream 2 pipeline risks U.S. sanctions and should immediately abandon work on the pipeline.”

Blinken reiterated those comments in an interview with BBC Radio 4 earlier this month, adding that the project “goes against the very principles that the EU has set out in terms of energy security and not being too dependent on any one country, notably, in this case, Russia.”

Germany has resisted US pressure to walk away from the pipeline, which is being built under the Black Sea by the Russian state-owned energy company Gazprom. Germany is the sixth-largest energy consumer in the world and the largest consumer of natural gas.

On Monday, Germany’s federal maritime regulator gave the go-ahead for work on the pipeline to resume, rejecting complaints by two environmental groups that sought to limit the time period when construction could take place.

Former President Donald Trump called attention to the pipeline in his term — claiming that Germany was “totally controlled” by Russia during a NATO meeting in 2018 — and sanctioned the project’s contractor in 2019.

In a breakfast meeting with NATO Secretary-General Jens Stoltenberg in July, 2018, Trump questioned why the US protects Germany while the country is involved in the energy deal with Russia– calling it “very inappropriate.”

“I think it’s very sad when Germany makes a massive oil and gas deal with Russia, where you’re supposed to be guarding against Russia​,​ and Germany goes out and pays billions and billions of dollars a year to Russia,” Trump ​told Stoltenberg at the time. “So we’re protecting Germany, we’re protecting France, we’re protecting all of these countries. And then numerous of the countries go out and make a pipeline deal with Russia where they’re paying billions of dollars into the coffers of Russia. And I think that’s very inappropriate.”

​”​But Germany is totally controlled by Russia, because they will be getting from 60 to 70 percent of their energy from Russia and a new pipeline​,” Trump continued.​