NORD STREAM 2 SANCTIONS
PLATTS - 26 Nov 2020 - Norway-based quality assurance company DNV GL will no longer provide certain services for the almost-complete Nord Stream 2 gas pipeline project due to the threat of US sanctions, a DNV GL spokesman said Nov. 26.
It is the latest setback for Nord Stream 2, which had engaged DNV GL to verify the safety and technical integrity of the pipeline system.
After the US State Department in October published new guidelines for the Protecting Europe's Energy Security Act (PEESA) statute, DNV GL said it found that certain activities would be subject to sanctions.
The DNV GL spokesman said: "Under these new guidelines, we find DNV GL's verification activities linked to vessels with equipment serving the Nord Stream 2 project to be sanctionable."
"DNV GL has therefore ceased delivery of services that may fall under the scope of PEESA," he said.
The US State Department on Oct. 20 widened the scope of sanctions to include companies providing services or goods that are "necessary or essential to the provision or operation of a vessel engaged in the process of pipe-laying."
Measures were already in place threatening sanctions against any company that laid the pipeline.
A little over 150 km of Nord Stream 2 remains to be laid in Danish and German waters, but the threat of US sanctions against companies involved in laying the pipeline has seen work suspended since the end of last year.
Switzerland-based Allseas was the principle pipe-layer for the project before work was halted.
The Nord Stream development company has said that, if imposed, US sanctions could directly hit more than 120 companies from more than 12 European countries.
European company protection
Asked for a reaction to DNV GL's decision, Nord Stream 2 said it was not in a position to comment or to disclose any commercial information.
But, it said, "it is up to governments and the European Commission to protect European companies from illegal extraterritorial sanctions."
DNV GL said it verifies pipeline safety and integrity around the world in accordance with its independent technical Standard DNVGL-OS-F101.
"Our work on the Nord Stream 2 project involves reviewing documentation and observing construction activities to ensure compliance with our Standard. This has included monitoring of the testing and preparation of equipment used on board vessels during the installation of the pipeline," the spokesman said.
"DNV GL operates a robust program to ensure our operations are in compliance with all relevant regulations and legislation, including sanctions," he said.
Nord Stream 2 is crucial to Russia's plans to scale down from 2021 utilization of the Ukrainian transit corridor for its gas supplies to Europe.
However, it remains unclear when and how the Nord Stream 2 operating company will lay the final kilometers of the pipeline.
Log in to read the publication.
An authorized user gets access to four FREE publications per month.
You can also buy a full access to all publications of the site since January 2014.