American investor Stephen Lynch, who has been doing business in Moscow for two decades, approached the US government requesting permission to participate in the auction for the sale of the Nord Stream 2 pipeline if it is put up for sale as part of bankruptcy proceedings in Switzerland, writes The World Street Journal. According to a letter reviewed by journalists, he argued to American officials and lawmakers that American ownership of the pipeline would provide leverage in peace negotiations with Russia to end the war in Ukraine and serve the long-term interests of the US.
'This is a once-in-a-generation opportunity to give Americans and Europeans control over energy supplies to Europe until the end of the fossil fuel era,' Lynch said in an interview.
At the same time, the investor believes he can buy Nord Stream 2, which is valued at approximately $11 billion, 'for pennies,' the publication writes, citing sources. Lynch believes that many investors will not participate in the auction due to the complex geopolitics associated with the pipeline, and among other contenders, there are likely to be Russian proxies, Chinese companies, or other entities whose interests contradict those of the US.
The construction of the pipeline was completed before Russia's full-scale invasion of Ukraine in 2022, but it was never put into commercial operation. It is owned by a subsidiary of the Russian state gas giant Gazprom, which filed for bankruptcy in Switzerland a few days after the invasion. In September 2022, underwater explosions destroyed one of the two strings of the pipeline. The other string remained undamaged but is not in use.
Lynch applied for a license from the US Department of the Treasury in February, according to the letter. The license would allow him to negotiate the construction of the pipeline with organizations currently under US sanctions.
The Miami investor successfully buys Russian assets at a discount, earning him a reputation as one of the few American investors capable of navigating the challenging business and political environment in the country. The Treasury Department granted him a license to acquire the Swiss branch of Russia's Sberbank in 2022, after the US imposed sanctions on the parent company.
However, questions have repeatedly arisen about Lynch's ties to the Russian government. A civil lawsuit alleges that Lynch and a group of foreign investors participated in a rigged auction in 2007 to sell assets belonging to Yukos. Managers of the Dutch branch of Yukos claimed that the investors colluded with Russian government officials to predetermine the sale of their company at a fixed price. In 2019, a British judge dismissed the charges against Lynch and other investors, writing that the defendants 'did not exhibit dishonesty' during the 25-day trial.
Businessmen and former government officials with experience in Russia say Lynch's plan faces significant obstacles but could gain momentum if it can be used as a bargaining chip for peace negotiations in Ukraine after Trump comes to power. Especially since during the last elections, Lynch donated more than $300,000 to committees supporting Trump.
Photo: AFP