U.S. to Insist on 'Real Steps' to Mitigate Russian Pipeline Impact

WASHINGTON (Reuters) — U.S. Secretary of State Antony Blinken said on Tuesday that Washington was working with Germany to try to mitigate any effects of the completion of the Russian Nord Stream 2 natural gas pipeline.

He also indicated that more penalties could be in order for those involved with the project, telling a U.S. Senate Appropriations Committee hearing, "We also of course have opportunities going forward to deal with those who provide insurance or other permits."

It was the second straight day that lawmakers questioned the top U.S. diplomat about the pipeline. The Biden administration opposes the project due to its potential to increase Russian influence over Europe by supplying natural gas and harming Ukraine, which would lose lucrative transit fees for gas shipments.

Blinken argued that working with Germany on the issue was a productive approach. "We want to make sure that Europeans take the necessary steps to protect, to mitigate, to deal with any of the adverse consequences of gas going through this pipeline," he said.

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

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

Blinken said the pipeline is expected to be completed, given that it is nearly finished, but he added: "There is a difference between the physical completion of the pipeline and it becoming operational."

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