October 1, 2019 / 7:40 AM / 15 days ago

Shell urges U.S. Congress to withhold Nord Stream 2 sanctions

MOSCOW (Reuters) - Royal Dutch Shell is asking the U.S. Congress not to enact sanctions against the Russia-led Nord Stream 2 undersea gas pipeline to Germany, said Cederic Cremers, head of Shell’s business in Russia.

FILE PHOTO: The logo of the Nord Stream 2 gas pipeline project is seen on the pipe cap at the construction site of the Nord Stream 2 gas pipeline, near the town of Kingisepp, Leningrad region, Russia June 5, 2019. REUTERS/Anton Vaganov/File Photo

A U.S. Senate committee passed a bill in July to place sanctions on companies and individuals involved in building the Nord Stream-2 gas pipeline from Russia to Germany.

The Donald Trump administration says the project would strengthen Moscow’s economic grip on Europe.

“If the current legislation under consideration in the U.S. Congress is passed, it will affect all of the companies involved with the project, including Shell. We therefore respectfully urge lawmakers not to enact these sanctions,” Shell’s Cremers said in emailed comments.

Russian gas producer Gazprom leads the project while other participants, who provide financial support, include Shell, Germany’s Uniper and Wintershall, Austria’s OMV and France’s Engie.

OMV has also publicly voiced its support for Nord Stream 2.

The project will double the annual capacity of the existing Nord Stream pipeline to 110 billion cubic meters and account for more than half of Russia’s piped gas exports to Europe, allowing it to bypass Ukraine, currently its main transit route.

In the wake of Russia’s 2014 annexation of Crimea its relations with Ukraine have soured and the European Commission has stepped up calls for member states to reduce their reliance on Russian energy imports.

The project faces legal challenges from Europe, which is changing its energy rules, including regulation of Nord Stream 2.

“European domestic gas production continues to decline, and Europe will soon need additional gas supplies both in the form of LNG and pipeline gas,” Cremers said in explaining Shell’s support for Nord Stream 2.

“At Shell we believe in the future of gas for Europe and that progressive use of natural gas can contribute significantly to the reduction of CO2 emissions,” he said.

Reporting by Vladimir Soldatkin; editing by Katya Golubkova and Jason Neely

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