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German port expected to continue working ‘normally’ despite US sanctions threat: ministry

The German port of Mukran is expected to continue normal operations despite a direct threat of US sanctions against the facility because of its involvement in the Nord Stream 2 gas pipeline project, the energy ministry of the state of Mecklenburg-Western Pomerania said Aug. 13.

Last week, three US senators sent a letter to two senior officials at the port, saying the facility was “knowingly” providing support to Nord Stream 2 and that this could expose the port to US sanctions.

Mukran is currently home to the remaining Nord Stream 2 pipe that is expected to be laid in Danish waters to complete the line and is also where the Russian pipelaying vessel Akademik Cherskiy is currently moored.

“We expect the port to continue its work ‘normally’ and to keep the commitments and implement the contracts it has entered into,” a spokeswoman for energy ministry of the state, which holds a stake in the port operator, Faehrhafen Sassnitz, said.

It remains unclear when and how the Nord Stream 2 operating company will lay the final 160 km (99 miles) of the pipeline in Danish waters.

The US in December last year implemented legislation that threatens sanctions against any entity laying Nord Stream 2 pipe, which prompted Switzerland’s Allseas to immediately halt its pipelaying work.

Expanded sanctions against the project are also now under consideration that would target more companies involved in laying the line’s final segment, including service providers and insurers.

‘Formal legal notice’

The letter — signed by US Senators Ted Cruz, Tom Cotton and Ron Johnson — represents a further escalation of trans-Atlantic tensions over Nord Stream 2.

The senators said the letter served as a “formal legal notice” that supporting Nord Stream 2 risked exposing Faehrhafen Sassnitz and the port of Mukran to “crushing legal and economic sanctions, which our government will be mandated to impose.”

The notice was also extended to the board members, corporate officers, shareholders, and employees of Faehrhafen Sassnitz and the port.

“These sanctions include potentially fatal measures that will cut off Faehrhafen Sassnitz from the US commercially and financially,” the letter stated.

“The only responsible course of action is for Faehrhafen Sassnitz to exercise contractual options that it has available to cease these activities,” it stated.

The port declined to comment, but the letter was met with a stern response from the energy minister of Mecklenburg-Western Pomerania, Christian Pegel.

“The sanctions that the US administration is threatening against those working on the Nord Stream 2 project, whether as a supplier, sub-contractor or financier, are unacceptable and contravene international rules,” Pegel said.

“After trying for a long time to undermine the sovereignty of European energy policy, they are now unabashedly attacking a German company,” he said.

“This is a new, frightening level of escalation,” he said.

Pegel also said he hoped that the federal German government and the European Commission would react with “serious” countermeasures.

Danish permit

The 55 Bcm a year pipeline is crucial to Russia’s plans to scale down from 2021 the use of the Ukrainian transit corridor in its gas supplies to Europe.

Under the Danish permit for laying the pipeline, Nord Stream 2 can use either vessels with anchors — such as the Fortuna — or those with dynamic positioning capabilities such as the Akademik Cherskiy to complete the pipelaying.

There are also no restrictions on Nord Stream 2 with regard to laying the pipe during times of cod spawn despite reports that work could not be carried out in August.

According to the permit, Nord Stream 2 finished pipelaying in December 2019 in the fisheries restriction zone, known as the Bornholm Basin.

The condition — which does not allow pipelaying in the area in July and August when cod spawn — is not relevant for the rest of the route.

Nord Stream 2 has said it will announce its plans to lay the pipeline in “due course” and must first submit an updated work schedule to the Danish authorities.

Russian Foreign Minister Sergey Lavrov said Aug.11 he believed the pipeline would be completed in “the near future.”
Source: Platts

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