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U.S. Warns That Sanctions Are Possible Over Nord Stream 2 Pipeline

U.S. Energy Secretary Rick Perry (left) and Russian Energy Minister Alexandr Novak meet in Moscow on September 13.

Washington may follow through on threats to impose sanctions over the construction of an underwater natural-gas pipeline between Russia and Germany, U.S. Energy Secretary Rick Perry has said.

Speaking on September 13 alongside Russian Energy Minister Aleksandr Novak in Moscow, Perry also called on Russia to be a “responsible supplier” and to stop using its resources for “influence and disruption.”

The Nord Stream 2 project aims to double the capacity of an already existing pipeline to 110 billion cubic meters per year -- more than one-quarter of the European Union's gas consumption.

The 1,230-kilometer link would deliver natural gas directly to Germany under the Baltic Sea, circumventing the traditional route through Ukraine.

Asked during a joint news conference with his Russian counterpart whether the United States might impose punitive measures against Nord Stream 2 and other projects, Perry said, "Yes."

“Minister Novak and I both agree that getting to that point of sanctions is not where we want to go,” he added.

SPECIAL REPORT: Nord Stream 2 And Why It's So Contentious (click to view)

Perry declined to specify what level of progress on Nord Stream 2 could trigger sanctions.

The United States, Poland, the Baltic states, and several other EU countries have expressed concern about the project, which would avoid existing gas pipelines through Ukraine and increase Europe's energy dependence on Russia.

U.S. President Donald Trump last year signed a law giving him the right to sanction companies involved in Nord Stream 2, which is led by Russian gas giant Gazprom, along with other European investors.

The Kremlin said the move was economically motivated and an attempt to promote U.S. liquefied natural gas in Europe.

In Moscow, Perry said the gas link will "create a new choke point at a shallow depth vulnerable to disruption."

The United States supports "the desire of Europeans to minimize their dependence on a single energy supplier" and supports increased competition, he added.

Novak said Moscow shared the view that "energy cannot be a tool to exercise pressure” and that consumers “should be able to choose the suppliers."

"We are concerned with the statements made and with the general position with regard to future sanctions against a very competitive project which is in the interests of European consumers," he added.

With reporting by AP and Bloomberg
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