France intends to fulfill its contractual obligations to Russia with the delivery of two Mistral-class amphibious assault ships for launching helicopters. 

Reuters, citing French diplomatic sources, is reporting that withholding the Mistrals will not be included in another round of European Union sanctions. The European body has been enacting sanctions to punish Moscow over the crisis in Ukraine.

The United States and other NATO countries have expressed concern about France’s $1.6 billion agreement in 2011 with Russia to supply two 

Mistral ships. Those concerns have been highlighted by the political instability in Ukraine and Russia’s annexation of Crimea in March.

French officials have publicly stated that they will review in deal in October, the same month as the first ship is planned for transfer to Russia. But Reuters’ unnamed French diplomatic officials said the country will proceed with the deal because it’s contractually bound to do so.

“They will be delivered. The contract has been paid and there would be financial penalties for not delivering it,” Reuters quoted a source as saying. “It would be France that is penalized. It’s too easy to say France has to give up on the sale of the ships. We have done our part.”

The report emerged as French Foreign Minister Laurent Fabius met with U.S. Secretary of State John Kerry May 13 in Washington. Victoria Nuland, the U.S. assistant secretary of state of Europe, said on May 8 that U.S. officials will continue to raise the issue.

“We have regularly and consistently expressed our concerns about this sale even before we had the latest Russian actions and we will continue to do so,” Nuland told the House Committee on Foreign Affairs.