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Biden to waive Trump-era sanctions on operator of Russian pipeline

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Germany has confirmed that the Biden administration is waiving sanctions on the company in charge of the Nord Stream 2 gas pipeline, a change of tack that removes a key bone of contention between Washington and Berlin.

Heiko Maas, the German foreign minister, saluted a “constructive step” that showed the US was “taking into account the really excellent relations that we’ve built up with the Biden administration”.

The US State Department is about to send its regular 90-day report to Congress listing the entities involved in the pipeline that will be sanctioned. Nord Stream 2 will bring Russian gas directly across the Baltic Sea, bypassing Ukraine.

Maas said that the list would include the Russian ships laying the pipeline, but that a “presidential waiver” would spare Nord Stream 2 AG, the company overseeing the project, as well as Matthias Warnig, its chief executive, who is a German national. Warnig, a former officer with the East German Stasi intelligence service, is a close ally of Vladimir Putin.

Maas said that the waiver showed the US “taking a step towards us”. “It’s an expression of the fact that Germany is an important partner for the US, one that it can count on in the future,” he said.

Nord Stream 2 was “the only issue that [Germany and the US] have fundamental differences about”, and the hope in both countries was that the project “will no longer strain the really excellent co-operation [between us] in any way whatsoever”, he added.

US president Joe Biden has been consistently critical of Nord Stream 2, describing it as a “bad deal for Europe”. The US says the pipeline will deprive Kyiv of lucrative gas transit fees and make it much more vulnerable to Kremlin pressure. US officials also argue it will also increase Europe’s dependence on Russian energy imports.

US secretary of state Antony Blinken said during his Senate confirmation hearings in January that he was “determined to do whatever we can to prevent . . . completion [of the pipeline], the last hundred yards”.

Blinken spoke to Maas on Tuesday, and a State Department spokesman said he had “underscored the US commitment to work with allies and partners to counter Russian efforts to undermine our collective security”. “In that vein, [he] emphasised US opposition to the Nord Stream 2 pipeline,” the spokesman said.

But the decision to waive sanctions shows Washington is not willing to risk a damaging row over the project with one of its closest allies. Germany supports the pipeline, which it says is a crucial pillar of its energy security, and has condemned US extraterritorial sanctions against the project, calling them unwarranted interference in its internal affairs.

A State Department spokesperson declined to confirm the waiver.

News of the exemption, first reported by Axios on Tuesday, was greeted with dismay on Capitol Hill, where opposition to Nord Stream 2 is one of the few issues that Democrats and Republicans agree on.

Representative Michael McCaul, a Republican, said it would show the US government was never planning to stop the project. “If the Putin regime is allowed to finish this pipeline, it will be because the Biden Administration chose to let it happen,” he said.

“Two months ago, President Biden called Putin a ‘killer,’ but today he’s planning to give Putin, his regime, and his cronies massive strategic leverage in Europe,” said Ben Sasse, a Republican senator from Nebraska.

The waiver will only be for the next 90 days. But Germany is confident that this will give the two countries time to overcome their remaining differences over Nord Stream 2.

Maas said the US and Germany should now use the time left till the next 90-day report to discuss “the particularly problematic aspects of the project”, especially the way “it has left Ukraine feeling threatened”.

“We have three months now . . . to talk with officials in Washington about how we proceed and how our two governments can reconcile the different positions that exist in Washington and Berlin on this issue,” he said.

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