Cruz Presses Trump on Blocking Russian Gas Pipeline to Germany

(Bloomberg) -- President Donald Trump is under pressure from two key senators to thwart completion of the Nord Stream 2 natural gas pipeline from Russia to Germany by sanctioning companies involved in the project.

Senators Ted Cruz, a Texas Republican, and New Hampshire Democrat Jeanne Shaheen are pushing to put a provision that would sanction companies involved in the construction of the pipeline in a defense spending bill that is viewed as a must-pass measure before Congress leaves Washington for the year.

Cruz expressed frustration with the Trump administration for not acting on its own to impose sanctions that could stop the pipeline, which is a project of Russian energy company Gazprom PJSC.

“I have heard no good arguments from the administration against imposing these sanctions,” Cruz said. “It makes no sense whatsoever that we're failing to act and act swiftly. The window is nearly closed. We have maybe 60 days until this pipeline is completed.”

Cruz and Shaheen sponsored legislation, which was approved by the Foreign Relations Committee in July by a vote of 20-2, that would target vessels that lay the pipeline and sanction executives from companies linked to those vessels. It would deny visas to those individuals and block transactions related to their U.S.-based property or interests.

Read More: Nord Stream 2 Faces Hurdles as Germany Dismisses Waiver Plan

The bill would also penalize entities that provide insurance to the project.

Defense Bill

It was never brought to the floor for a vote, but Senator Jim Risch, the chairman of the Foreign Relations Committee, told Defense News that the sanctions measure had been added to the draft of the National Defense Authorization Act. The sanctions measure may fall victim to haggling between Democrats and Republicans about what should or shouldn't be included in the defense bill.

“There is bipartisan support for the bill and for putting it in there if we can deal with the other issues that are outstanding,” Shaheen said. “There are issues that are important to various people in the caucus and I don't know what all of them are.”

Cruz added that “There has been real partisan tension on passing the underlying bill.”

The Nord Stream 2 project has divided the European Union, with nations led by Poland concerned about Russia's Gazprom tightening its grip on the region if the new pipeline comes online.

Cruz argued completion of the pipeline would give Russian President Vladimir Putin more leverage in the region and “generate billions of dollars for Russia that will be used to fund military aggression against America and against Europe.”

“The Trump administration has clear statutory authority to stop it today,” Cruz said.

Trump was non-committal when asked about sanctioning the pipeline companies as he met with German Chancellor Angela Merkel Wednesday during this week's NATO summit in London.

”Well, we haven't really determined that yet,” Trump said. “I do think it's a problem. But it's a problem that Germany's going to have to work out for themselves. Maybe for Germany, it won't be a problem. I hope it's not, actually. But we'll be talking about that.”

--With assistance from Jordan Fabian.

To contact the reporter on this story: Daniel Flatley in Washington at dflatley1@bloomberg.net

To contact the editors responsible for this story: Joe Sobczyk at jsobczyk@bloomberg.net, John Harney

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