June 13, 2019 / 5:25 PM / 5 months ago

U.S. senator introduces bill to sanction Russia-to-Germany gas pipeline

WASHINGTON, June 13 (Reuters) - U.S. Senator John Barrasso introduced a bill on Thursday to slap sanctions on individuals and companies developing Russia’s Nord Stream 2 natural gas pipeline project, a day after his fellow Republican, President Donald Trump, said he was considering sanctions on the pipeline.

Barrasso’s Energy Security Cooperation with Allied Partners in Europe bill, or ESCAPE, authorizes mandatory U.S. sanctions on anyone who invests at least $1 million, or $5 million over 12 months, or engages in trade valued at an equivalent amount for the construction of Nord Stream 2 and other Russian energy export pipelines.

Russian state gas producer Gazprom is leading the project, which runs under the Baltic Sea and will double the capacity of the existing Nord Stream system. Half of the funding for the project is provided by Germany’s Uniper and BASF’s Wintershall unit, Anglo-Dutch firm Shell , Austria’s <OMV OMVV.VI> and France’s Engie.

The Trump administration says Russia would use the pipeline as a political weapon, increase Moscow’s economic grip on Europe and deprive Ukraine gas transit fees important to its economy.

Trump said Nord Stream 2 “really makes Germany a hostage of Russia if things ever happen that were bad.” His administration has promoted shipments of U.S. liquefied natural gas (LNG) to Europe to help it diversify away from pipelined gas from Russia, but LNG is more expensive.

Russia and Germany have said the pipeline is a commercial project.

The ESCAPE bill, co-sponsored by several other Republican senators, is one of several in the U.S. Congress reflecting continued U.S. concerns over Russian influence in Europe, but the measure is many steps from becoming law. It would need to pass both the Senate and House of Representatives and be signed by Trump to take effect. Barrasso had introduced a version of the bill last year.

Republican senators including Barrasso introduced a different bill in May that authorizes sanctions against ships constructing deep sea pipelines for Russian energy export projects.

Barrasso, from gas-producing Wyoming, said the United States is blessed with energy abundance. “It only makes sense that we would use these resources to help our allies and loosen (Russian President Vladimir) Putin’s economic and political grip on the region,” he said in a statement.

Reporting by Timothy Gardner; Editing by Dan Grebler

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