The federal government says it is in talks to resolve the case of a Russian gas turbine stuck in Montreal due to Canadian sanctions against Moscow.
Citing the delayed return of equipment maintained by Germany‘s Siemens Energy to Canada, Russia’s state-controlled Gazprom reduced capacity along the Nord Stream 1 pipeline – which runs under the Baltic to Germany – to only 40% of usual levels in recent days. . The German energy regulator disputed this explanation, saying it did not explain the reduction.
“The Government of Canada is in active discussions with Germany over the wind turbines in question, and we are working to reach a resolution,” said Keean Nembhard, press secretary to Natural Resources Minister Jonathan Wilkinson.
The Department of Global Affairs, which is in charge of sanctions matters, declined to comment on why the turbine is grounded and referred matters to Mr Wilkinson’s office.
Gazprom is one of many Russian companies hit by Canadian sanctions triggered by the war in Ukraine. The type of gas turbine being repaired in Montreal is on Ottawa’s Restricted Goods and Technology list of products that cannot be exported, in order to “deny Russia access to goods and technologies that could benefit to his army.
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Commercial lawyer Mark Warner described the case as a case of less than nimble enforcement of measures intended to inflict pain on Russia – but which could also harm European gas consumers.
“It’s part and parcel of a very heavy-handed approach the Canadian government has taken to sanctions – even when Canada’s interests are indirect at best,” he said. “I hope someone in Ottawa thinks long and hard about how these sanctions work.”
He believes that the gas turbine should not be caught in the sanctions. “Companies like Siemens will think twice about getting things like this fixed in Canada.
Siemens Energy said in a statement this week that it supplied so-called aeroderivative gas turbines for a Nord Stream 1 compressor station in 2009. These were made in Canada and have to be returned regularly for maintenance, it said. said, adding that one of the turbines was being overhauled in Montreal.
Cyndee Todgham Cherniak, a specialist lawyer, said she saw three possible explanations for the delay in the turbine’s return.
The Canadian government may be reviewing a request for ministerial permission to release the turbine and the paperwork is pending, she said. Or the Canadian government requires an end-use certificate from those shipping the turbine to attest that it will not be diverted to Russia or to any sanctioned person or entity, she added.
“We’re not going to let him go unless we get the certifications that the Canadian government wants.”
A third possibility, Ms. Cherniak said, is that another government, such as the United States, is aware of the transaction and has urged Canada not to release the turbine because it believes it will be diverted to Russia.
For sanctions to work, Canada must be prepared to reject requests for relief even when the decision is difficult, she said.
“By keeping it in Canada at the port, we have the assurance that it will not go to the wrong person or the wrong country and that there will be no circumvention. As soon as he leaves Canada, the Canada Border Services Agency no longer has control over him and we, Canada, no longer have control over him.
Denying Gazprom the turbine increases sanctions pain and puts more pressure on Russia to change course, she said. “You have to make sure that Gazprom suffers and cannot make money. Yes, some companies will get caught and some transactions that have positive elements will not be able to proceed because the ultimate goal of sanctions is for other individuals to put enough pressure on Vladimir Putin to stop the war in Ukraine.
In Germany, which depends on Russia for most of its natural gas, the government disputed Gazprom’s explanation for the gas cuts.
“The Russian side’s argument is just a pretext. This is obviously a strategy to destabilize and drive up prices,” German Economy Minister Robert Habeck said in a statement after the latest drop.
With reports from Reuters
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