June 15, 2017, 15:27 / Business

Gazprom avoided US sanctions

European partners managed to finance Nord Stream 2 Artur Toporkov

The cost of the Nord Stream 2 project is estimated at 9.5 billion euros / Evgeniy Razumny / Vedomosti

The funds already invested by European partners will soften the level of impact of new sanctions on Nord Stream 2, says Roman Samsonov, head of the Gas and Arctic department at the Energy Center of the Skolkovo Business School . “We can only hope that the commercial interests of Gazprom’s main partners will turn out to be more significant than the sanctions imposed by the US administration and will not lead to their withdrawal from the project,” he says. According to the analyst, the problem may be attracting foreign partners to service the already introduced highways. The text of the document published by the US Congress does not allow us to accurately determine the extent of the impact of sanctions on the possibility of reconstructing and updating existing pipelines and maintaining their safety at the proper level.

European partners managed to finance Nord Stream 2 before the introduction of new US sanctions. Deputy Chairman of the Board of Gazprom Alexander Medvedev announced this at a conference in Berlin. “All funds, as planned, have already arrived in the accounts of Nord Stream 2 AG and are working on the project,” Medvedev said.

The US Senate tightened sanctions against Russia

Politics / International relations

On June 14, the US Senate approved a bill that gives the US President the right to impose sanctions on those who made a one-time investment of $1 million or more in Russia’s construction of export pipelines or provided equipment, technology and services for these purposes. The amount of such transactions during the year is limited to $5 million.

The management of Gazprom only smiles at this point in the bill of the American senators. “The numbers there are funny - $1 million, when projects cost many billions. We implemented projects in cooperation with European companies, banks and export credit agencies. I think the bill is aimed at American companies. The fact that financing terms have been reduced from 90 to 14 days is neither hot nor cold for us. Our investment payback period is tens of years,” said Alexander Medvedev.

The cost of the Nord Stream 2 project is estimated at 9.5 billion euros. The sole shareholder of the Nord Stream 2 AG project company, which is implementing it, is Gazprom. An agreement on a new model for financing the construction of the gas pipeline was signed by Gazprom, Engie, OMV, Royal Dutch Shell Uniper and Wintershall in April 2017. European companies pledged to provide 4.75 billion euros for the project in the form of long-term loans, about 950 million euros each .

Now the investments of Gazprom’s foreign partners in the project exceed 1 billion euros, TASS reports, citing the words of Alexander Medvedev.