Blinken: U.S. Able to Mitigate Nord Stream 2 Pipeline Effects

WASHINGTON (Reuters) — Secretary of State Antony Blinken said on Monday the completion of the Russian Nord Stream 2 natural gas pipeline was a "fait accompli,” defending the U.S. decision to waive some sanctions and vowing a response if Moscow tries to use gas as a weapon.

A State Department report sent to Congress in May concluded that Nord Stream 2 AG - the company behind the pipeline to Germany - and its CEO, Matthias Warnig, an ally of Russian President Vladimir Putin, engaged in sanctionable activity. But Blinken waived those sanctions, saying that this was in the U.S. national interest.

Germany, a key NATO ally with which Democratic President Joe Biden has sought to repair relations frayed during the administration of former Republican President Donald Trump, wants to complete the $11 billion pipeline.

"Germany has come to the table and we are actively engaged with them," Blinken told a hearing of the House of Representatives Foreign Affairs Committee.

"As a practical matter, the physical completion of the pipeline was, I think a fait accompli," Blinken said, when the administration decided to waive sanctions. "And irrespective of sanctioning that entity and the CEO, that would not in our judgment have changed anything in terms of the physical completion.

"I think we have an opportunity to make something positive out of a bad hand that we inherited when we took office."

Gazprom and its Western partners are racing to finish the pipeline to send natural gas under the Baltic Sea.

The project, now about 95% complete, would bypass Ukraine, depriving it of lucrative transit fees and potentially undermining its struggle against Russian aggression.

"We have agreements in place, upfront, to come back on any activities by Russia that are challenging the security or economic security of any of those countries," Blinken said.

Biden has opposed the pipeline project as a bad deal for Europe. The United States is an exporter of natural gas to Europe in the form of LNG, but Russian gas is cheaper.

Washington fears Russia could use Nord Stream 2 as leverage to weaken European Union states by increasing dependency on Moscow.

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