Why did the US ambassador threaten Germany over the Nord Stream II?

US Ambassador to Germany Richard Grenell has threatened several German companies with economic sanctions if they continue to be involved in the construction of the Nord Stream II gas pipeline, according to German national media.

"We emphasise that companies involved in Russian energy exports are taking part in something that could prompt a significant risk of sanctions," Grenell wrote to  companies that form part of the pipeline project.

The Nord Stream II pipeline is an underwater offshore project between Russia and Germany, crossing the Baltic Sea. Its construction started in May 2018 and one-third has already been completed.

The US strongly opposes the project and some EU member states have also been critical, arguing that the gas pipeline holds significant geopolitical value.

With the new pipeline, Germany and Russia aim to double the capacity of gas transferred across the Baltic Sea from 55 billion cubic metres to 110 cubic metres annually.

What is the pipeline about?

Russia is the largest exporter of natural gas and oil to the European Union. Up to 60 percent of EU imports are energy products, of which Russia exports the highest  share in natural gas (40.6 percent) and oil (28 percent).  

Five separate gas and oil pipelines transport Russian energy to the EU - mainly through Eastern Europe and the Ukraine. Three gas pipelines go through Ukraine, making it one of the major negotiators and profiteers of the energy flow.

To avoid passing through third countries such as the Ukraine, Russia and (Western) European states have built, and are still building, alternative routes; the Nord Stream I and the planned Nord Stream II are two of them.

Nord Stream II will directly transfer gas from Russia via the Baltic Sea to Germany -  mainly financed by Russian government-owned Gazprom and private companies from both sides. Since the completion of the predecessor project in 2011, the Gazprom group supplies western and central Europe, without involving eastern European territory.

However, the US does not welcome this project - neither do the EU’s eastern members or the Ukraine.

US threats towards its ally and the plan to replace Russia with Qatar

The US ambassador revealed the US plan to diminish Russian influence on European soil by replacing it with Qatari gas.

Qatar is the biggest liquefied natural gas (LNG) supplier worldwide and ‘should’, with the US, counterbalance Russia’s LNG export to Europe.

By threatening German companies with sanctions and ‘convincing’ Qatar to invest $20 billion in US LNG projects, Washington wants to narrow the ‘Russian circle’ on Europe’s gas dependency.

Qatar covers only around five percent of EU gas imports annually - and can only transfer gas to Europe by sea from a thousands of miles away, whereas Russia neighbours several European nations by both sea and land.

However, Berlin is sticking with the Nord Stream II pipeline construction, despite the opposition it faces both internally in the EU and from its overseas ally.