Nord Stream 2 pipeline closes operations, lays off all employees

The operator of the Nord Stream 2 gas pipeline, which connects Russia with Germany, has laid off more than 100 employees and closed operations, reports The Wall Street Journal.

A Swiss official said that Nord Stream 2 was having severe payment difficulties due to sanctions imposed on Russia over its invasion of Ukraine, resulting in all of its 106 employees being let go.

“Continued employment is no longer possible due to the payment difficulties,” said Silvia Thalmann-Gut, a senior executive in the local government of a Swiss region, to WSJ.

The official noted that Nord Stream AG, the Swiss company that built the pipeline, has not yet filed for insolvency, which Reuters reported it was considering. Insolvency differs from bankruptcy in that it declares it cannot pay its debts, while bankruptcy is a court order that depicts how an insolvent business will pay its debts.

Germany halted the joint pipeline project on Feb. 22 after Russia recognized and move troops into two breakaway regions in Ukraine’s eastern Donbas region (before the invasion). The pipeline was completed in September 2021 and was awaiting final approval from Berlin.

Once operating, Nord Stream 2 was set to double direct Russian gas imports to Germany. It has been criticized by the U.S. and other European countries as increasing Russia’s leverage over Germany even as energy costs on the continent are at record highs.

Germany and Italy are highly reliant on Russian gas, initially opposing the removal of Russia from SWIFT over fears it would not be able to pay for gas.