Nord Stream 2 AG

Report: Baker Hughes and others quit Nord Stream 2 amid threat of sanctions

U.S. oilfield services provider Baker Hughes, AXA Group, and 16 other companies have reportedly abandoned work on the Gazprom-led Nord Stream 2 pipeline project and will not be sanctioned by the U.S.

Nord Stream 2 AG

Reuters reported on Wednesday it had seen a document sent by the Biden administration to Congress last week, stating that Baker Hughes and other companies would not be sanctioned.

Russian energy giant Gazprom is building the gas pipeline to transport its gas to Germany through the Baltic Sea, with hopes to finish it this year.

The U.S. believes the project will increase Russia’s influence and leverage over Europe and that by bypassing Ukraine it will deprive it of lucrative transit fees.

It is also worth pointing out that the U.S. as one of the top gas producers would also like to export gas to Europe as an alternative to Russian gas.

As previously reported, DNV GL has already dropped out from the project amid pressure and threat of sanctions by the U.S.

The U.S. previously urged its European allies to stop the work that could help build the pipeline.

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According to Reuters, the list of companies that have dropped out of the project includes AEGIS Managing Agency Ltd, Arch Insurance Ltd, Aspen Managing Agency Ltd, AXA Group, Baker Hughes, Beazley Furlonge Ltd, Bilfinger, Canopius Managing Agents Ltd, Chaucer Syndicates Ltd, Chubb Underwriting Agencies Ltd, DNV GL, Hiscox Syndicates Ltd, Markel Syndicate Management Ltd, MS Amlin Underwriting Ltd, Munich Re Syndicate Ltd, Tokio Marine Kiln Syndicates Ltd, Travelers Syndicate Management Ltd, and Zurich Insurance Group.

When it comes to the pipeline project and its progress, the Gazprom-led consortium earlier in February resumed pipe laying offshore Denmark despite mounting pressure on the project from Washington.

Before that, back in December 2020, the Russian pipe-laying vessel Fortuna completed the 2.6-kilometre pipeline stretch of the Nord Stream 2 gas pipeline in German waters.

The Nord Stream 2 gas pipeline project is led by Russian giant Gazprom with half of the funding coming from five European partners – Germany’s Uniper, BASF’s Wintershall, Anglo-Dutch Shell, Austria’s OMV, and Engie.

The project is designed as two parallel 48-inch lines, roughly 1,200 kilometres long, each starting southwest of St. Petersburg and ending at German coast, Greifswald.

The gas pipelines will have the capacity to transport 55 billion cubic meters of Russian gas a year to the EU, for at least 50 years