Russia's Gazprom pays US$2.9 bln to Ukraine's Naftogaz under Stockholm Arbitration's award

In total, based on the results of the gas transit arbitration, Naftogaz received US$5 billion from Gazprom. Photo from UNIAN

Photo from UNIAN

National Joint-Stock Company Naftogaz of Ukraine has received US$2.9 billion from Russia’s gas giant Gazprom under the Stockholm Arbitration’s award, according to the Ukrainian company’s press service. Read also Naftogaz, Gazprom, and gas transit contract: who will ultimately win the “gas” battle “Naftogaz of Ukraine has confirmed receipt of US$2.918 billion in compensation from Gazprom in compliance with the 2018 Stockholm Arbitration’s award.

Thus, in total, based on the results of the [gas] transit arbitration, Naftogaz received US$5 billion from Gazprom,” the press service said on December 27. It is noted that the payment by Gazprom includes the repayment of both the previously unpaid part of the awarded compensation (US$2.56 billion) and the interest accumulated after the award was announced on February 28, 2018.

“Naftogaz welcomes the recognition by the Russian side of the need to comply with the 2017-2018 arbitration awards and its intention to continue transmitting gas to the European Union through Ukraine. The parties continue negotiations on the terms of further cooperation after the current contract with [Gazprom] expires on January 1, 2020,” the press service added.

As UNIAN reported earlier, at the end of February 2018, Russia’s gas monopoly Gazprom lost a lawsuit filed by Naftogaz with the Stockholm Arbitration over a gas transit contract. Gazprom was obliged to pay US$4.6 billion to the Ukrainian side.

At the same time, taking into account the arbitration award on the gas supply contract, the final amount of settlements between the two companies is US$2.6 billion (US$3 billion, including interest) in favor of Naftogaz.

On December 6, 2019, Executive Director of NJSC Naftogaz of Ukraine Yuriy Vitrenko said that at the negotiations with Gazprom representatives, the Ukrainian side announced its readiness to have Gazprom cover its US$3 billion debt in line with the Stockholm arbitration award with gas supplies to Ukraine.

On December 21, following trilateral negotiations in the Ukraine-EU-Russia format in Minsk, Minister of Energy and Environmental Protection Oleksiy Orzhel stated that the parties had concluded a protocol that provided for the implementation of a number of agreements.

In particular, a new contract for the transit of Russian gas to Europe via Ukraine will be concluded for a period of five years with the possibility of its extension for ten years. Naftogaz by year-end will have received from Russia’s Gazprom about US$2.9 billion in monetary compensation in line with the Stockholm arbitration award, given that the agreements reached during the negotiations are fulfilled.

(C)UNIAN 2019

2 comments

  • President Volodymyr Zelensky has welcomed Ukraine’s receipt of $2.9 billion in compensation from Russia’s Gazprom under a ruling of the Arbitration Institute of the Stockholm Chamber of Commerce.
    In a post on his Facebook page, Zelensky wrote: “Another victory. For someone, it may be a little one. But for the country it is a huge one. Naftogaz of Ukraine has received $2.9 billion in compensation from Gazprom under a ruling of the Stockholm arbitration court. The funds are already on the Ukrainian accounts – according to the reached agreements”.

    Володимир Зеленський

    @ZelenskyyUa
    Ще одна перемога. Для когось, може, й маленька. А для країни – велика. НАК «Нафтогаз України» отримав від «Газпрому» $2,9 млрд компенсації за рішенням Стокгольмського арбітражу. Гроші вже на українських рахунках – відповідно до досягнутих домовленостей.

    2,136
    6:17 PM – Dec 27, 2019

    Liked by 3 people

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.