Speaking ahead of bilateral talks with his German counterpart, Mr Putin insisted the Nord Stream 2 project is “purely economic”.
The multi-billion pound Nord Stream 2 will run through the Baltic Sea and supply gas to Germany and the EU.
Its construction is being funded by Russian state-owned giant Gazprom and a group of major European energy firms who say the project will help reduce carbon dioxide emissions by providing cleaner fuel to Europe.
But Washington has criticised the project for making a mockery of Western sanctions imposed after Mr Putin’s annexation of Crimea.
President Trump has warned it would make Germany dependant on Russian gas.
Speaking at a Nato summit last month, he said: “Germany, as far as I’m concerned, is captive to Russia because it’s getting so much of its energy from Russia.
“We have to talk about the billions and billions of dollars that’s being paid to the country we’re supposed to be protecting you against.”
Nord Stream 2 has also come under fierce criticism from some European nations including Ukraine, which stands to lose billions of dollars every year in transit fees.
Standing alongside Ms Merkel, Vladimir Putin also said he would discuss Iran and ways to help Europe with the “huge burden” of refugees fleeing conflict in the Middle East.
He said Syria needed assistance to rebuild and to ensure that refugees who had fled the country could safely return to their homes.
Ms Merkel told reporters she would discuss the conflicts in Ukraine and Syria, as well as Iran and the Nord Stream 2 project.
The German chancellor also said she would raise human rights issues and bilateral relations.
She said: ”I am of the opinion that controversial issues can only be addressed in dialogue and through dialogue.”