Naftogaz Complains of non-Delivery from Russia

Gazprom’s decision not to supply gas to Ukraine in March despite full prepayment violates the supply contract amended by the Stockholm Arbitral Tribunal, Naftogaz Ukrainy said March 1. It said it would demand that the Russian state-owned export monopoly provides compensation for the damage caused.

"By refusing to supply this prepaid gas, Gazprom prevents Naftogaz from fulfilling the award regarding the purchase of minimum contract volumes,” said Naftogaz CEO Andriy Kobolyev. Naftogaz must buy at least 4bn m³/yr from Gazprom priced against European hubs, but cheaper owing to the closer delivery point: the Ukraine-Russia border.

According to Kobolyev, over the past four years of gas purchases from European suppliers, Naftogaz never encountered a comparable situation where the company did not receive prepaid gas. Ukraine has not bought Russian gas, contractually, for over two years, but it has bought European hub gas that originated in Russia.

Kobolyev said a company that did not meet its contract obligations in this way should not be allowed to strengthen its already considerable influence in Europe by building Nord Stream 2.