President Biden on Wednesday expanded U.S. sanctions against Russia to include penalties against the builder of the $11 billion Nord Stream 2 natural gas pipeline that connects Russia and Germany.
Mr. Biden imposed sanctions against the Nord Stream 2 AG, the Swiss firm that built the pipeline and its corporate officials as part of the U.S. response to Russia’s continued aggression in Ukraine.
Nord Stream 2’s parent company is Gazprom, the Russian state-owned energy giant.
“These steps are another piece of our initial tranche of sanctions in response to Russia’s actions in Ukraine. As I have made clear, we will not hesitate to take further steps if Russia continues to escalate,” Mr. Biden said in a statement.
Although Mr. Biden had signaled that sanctions on Nord Stream 2 would be likely, it was somewhat surprising since his administration waived Trump-era sanctions against the company building the pipeline last year.
At the time, Secretary of State Antony Blinken said the sanctions had “negatively impacted U.S. relations with Germany, the E.U. and other European allies and partners.”
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Lawmakers of both parties denounced the May 2021 decision and Sen. Bob Mendez, New Jersey Democrat and chairman of the Foreign Relations Committee, said the move encouraged Russian aggression.
The Nord Stream 2 penalties imposed Wednesday are in addition to the sanctions Mr. Biden slapped against Russia on Tuesday, which included penalizing two large Russian banks and several Russian elites.
On Tuesday, Berlin halted certification of the project as the Ukraine crisis escalated. The move was a blow to Mr. Putin’s plan to expand Russia’s control over Europe’s energy supply. Russia already supplies about one-third of the energy used by Europe.
Moscow appeared unmoved by the action, saying Germany was just hurting itself with the move.
Germany had been long hesitant to halt the project even as Russia ramped up its aggression against Ukraine.
Asked whether the U.S. should have pressured Germany to take a stronger stance earlier, State Department spokesperson Ned Price said diplomacy with Berlin led to its actions.
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“The fact that Germany acted so quickly, so decisively is in many ways a product of the coordination, of the consultation,” Mr. Price said. “The fact we are acting in unison to take these steps, that essentially remove Nord Stream 2 from the equation — that is a byproduct, that is a result of the work we have done with the German government.”
Several Republicans in Congress, including Sen. Ted Cruz of Texas, had threatened to block votes for several of Mr. Biden’s nominees for U.S. ambassador posts and other senior State Department positions unless the administration imposed sanctions on the pipeline.
The 750-mile pipeline was completed in September but had not received final certification from German regulators to come online. Until it is approved, natural gas can’t flow from Russia to Germany.
The U.S., United Kingdom, and several European countries had opposed the pipeline since it was announced in 2015, warning the project would increase Europe’s reliance on Russia.
The pipeline would deliver more than 50% of Germany’s annual gas consumption and could generate as much as $15 billion to Gazprom.
• Tom Howell Jr. contributed to this report.