Gazprom has officially forwarded a notification to Naftogaz-Ukraine about gas supply contracts termination through the Stockholm Arbitration. Alexey Miller, the Head of the company, told journalists about it, Interfax-Ukraine reports.
“The Stockholm Arbitration, guided by double standards, made a biased decision on the gas supply contract with Naftogaz. Arbitration’s decision has significantly upset the balance of interests of the parties to the contract,” Miller said.
“Arbitrators based their decision on Ukraine’s sharp economic slowdown. We definitely don’t want to worsen the economic problems in Ukraine. In such situation, the extension of the agreement is economically unviable and unprofitable for Gazprom,” he said.
As we reported earlier, after the ruling of the Stockholm Arbitration, Russia's Gazprom announced its intention to terminate gas contracts with Naftogaz Ukraine.
The Arbitration Institute of the Stockholm Chamber of Commerce has granted the lawsuit of Naftogaz as to compensation for the volumes of transit gas that had not been delivered by Gazprom on February 28. According to the decision of the court, Naftogaz got a $4,63 billion compensation for the transit gas that had been agreed on, but not delivered by Gazprom. As a result of two arbitrations in Stockholm, Gazprom is to pay Naftogaz $2,56 billion. The court dismissed the demands of Gazprom that stated that the money hadn’t been paid as it was considered the fines for what they called unlawfully seized by Naftogaz volumes of the transit gas. $526 000 of interest per day will be added to the debt from March 1.
As reported earlier, on March 1 Gazprom reported that Naftogaz-Ukraine has made an advance payment for the resumption of Russian gas supplies from March. At the same time, Gazprom refunded the money, stating that this was due to the lack of an agreed addendum to the current contract. Naftogaz called Gazprom's refusal to supply gas a violation of the agreement and failure to comply with the arbitration decision.