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Republicans criticize Biden plan for sanctions over Russian pipeline

Republican lawmakers are accusing the Biden administration of failing to take decisive action against the pipeline, The Nord Stream 2
Image: Workers are seen at the construction site of the Nord Stream 2 gas pipeline in Russia
Workers at the construction site of the Nord Stream 2 gas pipeline, near the town of Kingisepp, Leningrad region, Russia, on June 5, 2019.Anton Vaganov / Reuters file

The Biden administration on Friday told Congress it would impose sanctions on a Russian ship and company helping to finish a Russian natural gas pipeline, but Republican lawmakers said the move fell far short of what was required to halt Moscow’s project.

In a report to Congress, the State Department identified the Russian ship Fortuna and its company, KVT-RUS, to be designated for sanctions under a law adopted in January designed to prevent the completion of the Russia-to-Germany gas pipeline known as Nord Stream 2.

Both entities had already been sanctioned by the former Trump administration, and lawmakers had sent a long list of companies to the administration that they said were conducting work or services that should trigger U.S. sanctions.

None of those companies were named in the State Department report to Congress, which arrived three days past a Tuesday deadline.

The report, obtained by NBC News, does not mention Russia by name or Ukraine. Kyiv has appealed to Washington to block the pipeline.

The State Department’s report will be welcomed in Germany, which has lobbied against the sanctions and defended the pipeline as a valuable commercial project that will provide a stable, inexpensive supply of energy.

But the report will likely disappoint governments in Central and Eastern Europe, which strongly oppose the project, arguing it could grant Russia economic leverage over Europe and leave them more vulnerable to pressure from Moscow. Nord Stream 2 would deprive Ukraine of lucrative gas transit fees that generate crucial revenue for the government.

“Whoever is preventing these sanctions from being fully imposed right now is doing Vladimir Putin a favor. From Ukraine’s perspective, we simply can’t imagine that this is what President Biden wants,” said Vadym Glamazdin, a senior official at Ukraine’s state energy giant Naftogaz.

The report came as President Joe Biden delivered a speech virtually to the Munich security conference in which he vowed to show resolve against Russia and to bolster the transatlantic alliance.

A bipartisan majority in Congress adopted legislation in January, overriding ex-President Donald Trump’s veto, that imposed additional sanctions on any companies enabling the completion of the Nord Stream 2 project, including firms insuring or certifying the pipeline.

Rep. Michael McCaul, R-Texas, ranking Republican on the House Foreign Relations Committee, accused the administration of failing to carry out the will of Congress.

"Simply put, today’s sanctions designations are wholly inadequate,” McCaul said in a statement, adding that “congressional intent is clear and cannot be ignored.”

"Sanctioning only the Russian pipe-laying vessel Fortuna and its owner, KVT-RUS — which were both already sanctioned by the previous Administration under separate authorities — does not meet that intent,” McCaul said.

Sen. Jim Risch, R-Idaho, ranking member of the Senate Foreign Relations Committee, called the State Department’s report troubling and misleading.

“We know pipeline construction is currently underway in the Baltic Sea. Maritime tracking information makes it clear that ships not covered in today's report are currently active in supporting Nord Stream 2 construction,” Risch said.

“The administration's decision to ignore these activities demands an immediate explanation.”

Earlier on Friday, before the report was submitted to Congress, State Department spokesperson Ned Price reiterated that the administration opposed the pipeline and was consulting with its European allies on the issue.

“We've been clear for some time that Nord Stream 2 is a bad deal and that companies risk sanctions if they are involved. But as we said, we don't preview any potential sanctions. We'll continue to work with our allies and partners to ensure that Europe has a reliable diversified energy supply network that doesn't undermine our collective security,” Price said.

The State Department did not respond to requests for comment about why it had chosen not to designate German or other Western companies that opponents say are involved in the project.