The United States will impose sanctions on the company in charge of the construction of the Nord Stream 2 gas pipeline, President Joe Biden announced on Wednesday.

“Today, I directed my administration to impose sanctions on Nord Stream 2 AG and its leaders,” Biden said in a statement released by the White House.

The United States on Tuesday welcomed Germany’s decision to suspend certification of the gas pipeline in response to Russia’s recognition of the independence of the self-proclaimed “People’s Republics” of Luhansk and Donetsk. The White House said it would follow its own measures.

US imposes new round of sanctions

The measures against the company behind the Russian gas pipeline are the latest round of sanctions imposed by Western powers. The United States, United Kingdom and European Union, along with others such as Japan and Australia, imposed sanctions on the Russian economy on Tuesday.

The Nord Stream 2 pipeline, which cost around 9.5 billion euros ($10.6 billion) to build, would transport the gas directly across the Baltic Sea to Germany.

Germany viewed the pipeline as essential to its energy needs, but German Economy Minister Rober Habeck said on Wednesday that Germany’s gas supply was secure even without Nord Stream 2, although prices are expected to increase further in the short term.

Biden hails unified response

In his statement, Biden praised Germany for being a “leader” in moving forward in a coordinated manner, adding that the United States “would not hesitate to take further action if Russia continues to intensify”.

“By acting with the Germans the way we did, when we did and the way we did, we made sure that this is an $11 billion investment that is now a piece of steel, sitting at the bottom of the sea,” State Department spokesman Ned Price said.

A controversial pipeline

Germany had faced immense pressure from the start to end the project, although it maintained that the pipeline was a commercial project, with several European partners and the United States fearing that it would make the country too dependent on the Russia.

The pipeline, which connects western Russia to northeastern Germany, had stood idle, pending certification from Germany and the European Union, since its completion in September last year.

But completing the pipeline was far from a smooth process. Besides pressure from world powers, in 2018, while the pipeline was being built, US President Donald Trump announced sanctions against anyone involved in the project.

Most companies pulled out of the program, with Russia’s state-owned energy company Gazprom saying it would complete the project on its own. He did, and in May 2021, President Biden lifted sanctions against Gazprom in a bid to restore relations with Germany.

Nord Stream 2 AG is a registered Swiss company owned by Gazprom. Gazprom owns the entire pipeline but has paid half the cost, with the rest shared by Shell, Austria’s OMV, France’s Engie and Germany’s Uniper and Wintershall DEA.

rm/nm (Reuters, AP)