US House panel passes amendment to stop sanctions waiver on Nord Stream 2

Pipeline is 95 per cent finished and bill has a long way to go before becoming law

Part of the Nord Stream 2 gas pipeline project at the Chelyabinsk pipe rolling plant in Russia. Reuters

The Joe Biden administration could face pressure to block Russia's Nord Stream 2 natural gas pipeline after a House of Representatives panel this week passed an amendment seeking to repeal the US State Department's ability to waive sanctions on the project.

“These sanctions are mandatory not discretionary,” said Marcy Kaptur, a Democratic representative and a sponsor of the amendment to a foreign aid bill. The House panel passed it unanimously.

The amendment seeks to repeal sanctions waivers in Fiscal Year 2022. But the pipeline is 95 per cent finished and the bill has a long way to go before becoming law, needing to pass another House committee, the full House, the Senate and be signed by Mr Biden.

In May, the State Department sent to Congress a report that concluded that Nord Stream 2 AG and its chief executive, Matthias Warnig, an ally of Russian President Vladimir Putin, engaged in sanctionable activity. But Secretary of State Antony Blinken immediately waived those sanctions, saying it was in the US national interest.

Mr Biden, a Democrat, has opposed the $11 billion project that would take Russian gas from the Arctic to Germany, saying it is a bad deal for Europe.

But the president also wants to improve ties with Germany, an ally he needs to help deal with broader issues including climate change, economic recovery and relations with Iran and China. The US is an exporter of natural gas to Europe in the form of liquefied natural gas, but Russian gas is cheaper.

Washington fears Russia could use Nord Stream 2 as leverage to weaken EU states by increasing their dependency on Moscow. The project would bypass Ukraine, depriving it of lucrative transit fees and potentially undermining its struggle against Russian aggression.

The State Department did not immediately respond to request for comment from Reuters about the amendment.