Germany is discussing ways to compensate Ukraine for the financial loss it will suffer from the completion of a controversial Russian natural-gas pipeline backed by Berlin, U.S. Secretary of State Antony Blinken has told Congress.
Nord Stream 2 will carry gas from Russia to Germany via the Baltic Sea, bypassing Ukraine, and is expected to deprive Kyiv of billions of dollars in annual transit fees if it is completed.
The United States — as well as many countries in Eastern Europe — have opposed the project on the grounds that it will make Europe more dependent on Russian energy and undermine Ukraine’s economy and security.
Nonetheless, the Biden administration last month agreed to waive some sanctions on Nord Stream 2, all but ensuring its completion, in an attempt to mend strained relations with ally Germany, which continues to support the project.
In a hearing on June 7 at the House of Representatives’ Foreign Relations Committee, Blinken partially justified the waiver, saying Germany “has come to the table” to discuss how it can help Ukraine deal with the economic fallout.
“We are actively engaged with [Berlin] to look at what can and should, and I believe must be done to…make sure that the transit fees that Ukraine at some point in the future may lose as a result of this pipeline…[is] made whole,” Blinken told the committee.
He did not give details on what form the compensation could take. Some have suggested Germany could invest in Ukraine’s alternative-energy industry.
Blinken also said it was important to have upfront agreements in place with Germany that would allow the United States to impose sanctions on the pipeline at a later date should Russia seek to use it as a coercive tool against its neighbors in Eastern Europe.
U.S. President Joe Biden and Ukrainian President Volodymyr Zelenskiy were expected to discuss the pipeline in a phone call later in the day.