The Reagan administration, using its trade sanctions against the Soviet Union to undermine a planned natural gas pipeline linking Siberia and Western Europe, has vetoed a $175 million sale of components for the project by the General Electric Co.
In addition, the administration has broadened the scope of the ban on exports of energy-transmission equipment to the Soviet Union that President Reagan announced after the imposition of martial law in Poland last month by applying it not just to direct U.S. exports but also to "technical data" and products manufactured abroad under license from U.S. companies.
As a result, it now seems possible that the sanctions, regarded as largely symbolic when they were announced, will at least delay one of the biggest Soviet-European business deals in history.
State Department Alan Romberg confirmed yesterday that "we have asked our allies to take actions parallel to our own and not to undercut our trade controls." Though the Europeans have not committed themselves to specific actions, the major NATO allies jointly pledged yesterday "not to undermine the effect of each other's measures."
General Electric had a firm order to supply components for gas turbine compressors that are to be supplied to the Soviets for the pipline project by three European industrial firms, Nuovo Pignone of Italy, John Brown & Co. of Britain, and AEG-Telefunken of West Germany.
But the company was notified that its application for an export license would not be approved because Reagan's new sanctions apply to any equipment or technical data intended "directly or indirectly" for the Soviet Union.
A French firm manufactures the same type of components under license from GE, but the terms of the export ban published in the Federal Register last week, covering "data" as well as equipment, appear to preclude the purchase of replacements from that firm even if the French government were to permit it.
A GE spokesman said yesterday the company "will of course comply with any directives issued by the government." Earlier, the Caterpillar Tractor Co. was forced to give up a $80 million sale of pipe-laying equipment for the Soviet project. The pipe layers can be obtained in Japan, but it is not clear whether alternatives suppliers are available for the gas turbine equipment.
The Soviet-German pipeline is a mammoth 2,400-mile project expected to provide 1.4 trillion cubic feet of gas annually to Western Europe, and to earn the Soviet Union more than $7.5 billion a year in precious hard currency. The Reagan administration vigorously opposed it on political grounds, but the Germans signed the agreement on Nov. 20, a month before the Polish crackdown.
Since Reagan imposed the U.S. sanctions, however, the project has emerged as the principal potential victim of the freeze in Soviet-U.S. trade.