Nord Stream 2 ‘Cannot Confirm’ Reports of Bankruptcy Filing

(Bloomberg) -- Nord Stream 2 AG, operator of the controversial gas pipeline under the Baltic Sea to Germany, said it can’t confirm published reports that it has filed for bankruptcy amid a raft of international sanctions against Russian assets.

“We cannot confirm the media reports,” it said in a statement. Switzerland-based Nord Stream 2 AG “only informed the local authorities that the company had to terminate contracts with employees following the recent geopolitical developments leading to the imposition of U.S. sanctions on the company.”

Amid international condemnation of Russia’s war in Ukraine, the U.S. slapped tougher penalties on Nord Stream 2 AG and its corporate leadership last week. While the European Union didn’t impose its own sanctions on the project, German Chancellor Olaf Scholz asked the Economy Ministry to withdraw its assessment that the pipeline didn’t pose a threat to security of supply.

The Nord Stream 2 link was completed in December, following delays arising from earlier U.S. sanctions on insurers and vessels involved in building the project. A positive assessment from German regulators was necessary for its certification and the start of gas flows. It could pump as much as 55 billion cubic meters of gas to Europe every year.

Nord Stream 2’s operator also took its website down “due to serious and continuous attacks from outside,” it said Wednesday. The company’s phone lines “are also not reachable.”

Gazprom PJSC’s pipeline, which was set to become “a stabilizing element for the European gas market,” is unlikely to play this role “in the foreseeable future,” Maria Zakharova, spokesperson for the Russian Foreign Ministry, said in a separate statement.

Scholz’s decision to freeze certification gives the project’s investors the right to file lawsuits against Germany in international courts and demand compensation, she said. 

Gazprom is the sole owner of the link, though five EU energy companies -- Wintershall Dea AG, OMV AG, Shell Plc, Engie SA and Uniper SE -- provided loans to finance the $11 billion project. All of the Nord Stream 2 shares were pledged “until a full settlement of the secured obligations.”

(Updates with Foreign Ministry statement, more details starting in new sixth paragraph.)

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