Russia's Gazprom asks court to halt Ukraine gas contracts after losing dispute
03:54, Mar 4, 2018
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"Gas supply and transit should never be a political weapon".
On Wednesday, Stockton Arbitration ordered Gazprom to pay 2.56 billion Dollars under the transit contract with Naftogaz Ukraine, but the company disagreed with the court decision and announced its intention to "protect its rights in line with the legislation it adopted". In the dispute over the gas transit contract, it is important not only the amount of compensation, but also the decision on the tariffs for the Russian gas transportation across Ukraine.
And he urged Ukrainian companies to adjust their operations to save gas, while power companies were ordered to switch to fuel oil where possible.
On 1 March the Deputy Chairman of Gazprom Alexander Medvedevsaid that the Russian company has received and returned the advance payment from Naftogaz, and will not supply gas to Ukrainian counterpart since March 1.
The court had previously delivered a separate verdict in the dispute over gas supplies between Gazprom and Naftogaz. "This will improve security of supply and give Ukrainians affordable energy", Kobolyev added. The decision seriously violates the balance of interests of the parties under these contracts, according to Miller.
"At the same time, Gazprom did not supply Naftogaz with 18 million cubic meters of gas, for which the company made a prepayment". However, since 2012, the cash-strapped Naftogaz cut imports dramatically, leading to a row over the take-or-pay clauses in the deal. Since November 2015, Kiev has not bought Russian gas, replacing it with reverse gas from Europe. Naftogaz wanted a retroactive price change starting from May 2011. In addition, most of the gas storage facilities to hold a reserve of gas ahead of the winter heating season are located on Ukraine's territory, not Russia's.
Last year, Gazprom had its $56 billion take-or-pay claims rejected by the Tribunal and Naftogaz had its minimum annual offtake obligation reduced from 41.6 billion cubic meters (Bcm) to 4 Bcm. Summing the two awards, Gazprom has been left with a bill of $2.56bn.
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