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Austria’s OMV, Voestalpine planning to adhere to agreements with Russia on Nord Stream 2

July 28, 2017, 9:10 UTC+3 VIENNA

Russian gas supplies via the Nord Stream 2 pipeline are crucial for the European market

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VIENNA, July 28. /TASS/. OMV and Voestalpine, Austria’s biggest companies involved in the Nord Stream 2 project on construction of the natural gas pipeline, are closely monitoring the situation around potential introduction of new US sanctions against Russia and plan to adhere to their agreements with Moscow, sources in the two firms told TASS.

Russian gas supplies via the Nord Stream 2 pipeline are crucial for the European market, a representative of OMV told TASS, adding that the anti-Russia sanctions have proved inefficient over the past years. "Europe is interested in ensuring security of gas supplies on its own. Europe is confident that additional deliveries of Russian gas are necessary as its own production is declining. In this respect, the Nord Stream is a good project as it will ensure additional safety of supplies and provide attractive conditions for European consumers," the source in the company told TASS.

Meanwhile, OMV considers it too early to make any judgements regarding potential implications of the new package of anti-Russia sanctions being considered in the United States that can also affect Russia’s European partners. "It is too early to make judgements. We closely monitor the situation and will analyze all considerations. It is still not clear when and to what extent the sanctions based on the law (on toughening restrictions against Russia, Iran and North Korea - TASS) will be imposed, and it is not clear which contracts and operations they will cover," the source said, adding that "OMV will adhere to all its contractual commitments and will comply with potential new sanctions if needed."

Meanwhile, a representative of Voestalpinе said that the company tries to refrain from giving comments on political decisions, but it focuses on fulfillment of its contractual commitments to Russian customers. "As far as we understand the United States are trying to toughen sanctions against Russia, though we are unaware of details," Spokesman Peter Felsbach told TASS.

According to Felsbach, Voestalpine understands that sanctions may be imposed on companies that cooperate with Russia and have contractual obligations on construction and maintenance of gas pipelines. "Last year the steel division of Voestalpine Grobblech GmbH received an order on supply of several hundred thousand tonnes of steel sheets of top quality for the underwater section of the Nord Stream 2 gas pipeline. The order has mostly been executed, delivered and paid for," he said.

Earlier the European Commission urged the US to agree its unilateral restrictive measures with partners and warned of potential negative implications that the new package of sanctions can have for the EU’s energy security. European Commission President Jean-Claude Juncker also said Brussels must be ready to act swiftly in case the United States takes measures ignoring the European Union’s concerns, and if the new package of sanctions threatens its energy security.

According to official spokesperson of the Austrian Chancellor Juergen Schwarz, the sanctions planned by the United States against Russia may affect operations of European companies in the energy infrastructure sphere and therefore extraterritorial application of such US laws is unacceptable.

As reported earlier the US Senate passed the bill toughening the country’s unilateral sanctions against Russia, Iran and North Korea as senators voted 98-2 on the bill on Thursday. Since it has passed through both chambers, the document titled "Countering America’s Adversaries Through Sanctions Act" will be sent to President Donald Trump. The White House has recently signaled that Trump favors toughening of restrictions against the three countries, though he will take a decision after revising the final version of the draft law.

The US bill contains restrictive measures against Russia taken by the previous Barack Obama administration on the basis of executive orders - the sanctions introduced on March 6 and December 18, 2014, on April 1, 2015 and on July 26 and December 29, 2016.

The bill provides that the US President may levy sanctions on persons planning to invest over $5 mln per year or $1 mln at a time in the construction of Russian export pipelines, provide services and technologies to such projects and provide information.

According to the document, the US government is to continue efforts to prevent the construction of Nord Stream 2. The bill claims that the project negatively affects the European Union’s energy security, the development of gas market in Central and Eastern Europe and energy reforms in Ukraine. Also, the draft law urges the US government to focus on exports of American energy resources to Europe in order to add new jobs in the country’s own economy.

The construction of the Nord Stream 2 natural gas pipeline is planned to begin in 2018 and compete in end-2019. The 1,220-kilometer pipeline will run across the bottom the Baltic Sea from the Russian coast to Germany. The capacity of each of its two threads will be 27.5 billion cubic meters a year. The new pipeline will double the capacity of Nord Stream, basically following the same route. The pipeline will directly tie Russia’s resource base with European customers.

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