Reuters learned of Nord Stream 2's bankruptcy advice due to sanctions US imposed sanctions

The operator of the Nord Stream 2 gas pipeline, Nord Stream 2 AG, is now considering filing for bankruptcy. This was reported to Reuters by two sources familiar with the situation. The company is owned by Gazprom.

The agency's interlocutors, who spoke on condition of anonymity, told Reuters that Swiss-registered Nord Stream 2 AG is working with a financial adviser to pay off some of its obligations and could formally begin insolvency proceedings in a Swiss court as early as this week.

On February 23, the US imposed sanctions against Nord Stream 2 AG and company officials. US President Joe Biden explained these actions as an escalation of tension in Ukraine. He also stressed that the sanctions were imposed after "close consultations" between the US and German governments. Prior to this event, on February 21, Russian President Vladimir Putin recognized the sovereignty of the Donetsk and Luhansk People's Republics.

The company and CEO Matthias Warnig have been placed on the SDN sanctions list, which provides for the blocking of assets and isolation from the dollar system. In addition, the Office of Foreign Assets Control (OFAC) of the US Treasury published a document according to which investors must complete transactions with the gas pipeline operator and companies controlled by it by March 2, 2022.

Germany also suspended the certification of Nord Stream 2 on February 22. German Chancellor Olaf Scholz said that the project cannot be certified due to Russia's recognition of the DPR and LPR, and the situation, including the one concerning the gas pipeline, needs to be reviewed. The Russian Foreign Ministry called the actions of the German authorities pressure on business, and Kremlin spokesman Dmitry Peskov expressed the hope that this decision was temporary.