Gazprom sends materials to Stockholm to denounce contract with Naftogaz

Gazprom has sent materials to Stockholm to denounce its contract with the Naftogaz of Ukraine, RIA Novosti reports citing the Russian gas holding.

“Today, Gazprom has sent to Stockholm documents to denounce its contracts with the Naftogaz of Ukraine on gas supply and gas transit with the territory of the republic. Negotiations with the Naftogaz of Ukraine yielded no results,” Gazprom said.

To remind, as early as in the beginning of May, CEO of the Russian gas monopoly announced start the procedure for termination of the contracts for gas supply and gas transit that are to expire in 2019.

“The Stockholm arbitration tribunal based on double standards has taken an asymmetrical decision on contracts for supply and transit of gas with the Naftogaz of Ukraine. Thus, the court verdict has significantly breached the balance of interests of the parties in the contracts,” Gazprom CEO Alexey Miller told reporters. According to him, the arbiters explained their decision by drastic deterioration in the Ukrainian economy. “We are absolutely against solving Ukraine’s economic problems at our expense. In this situation, persistence of the contract is ineffective and unprofitable for Gazprom,” he said.

In late February, the Stockholm arbitration tribunal ruled that Gazprom is to pay the whole amount of contracted gas transit and awarded Naftogaz with a $4.5bn compensation for gas that was not delivered for transit. Earlier, the tribunal ruled on the gas supply contract and obliged the Ukrainian company to pay $2bn for the gas consumed. The court refused to Gazprom in having a compensation for non-bought volumes of gas, despite sanctions envisaged by the contract.