Naftogaz withholds further overpayment by Gazprom to offset amounts due under arbitration award

Naftogaz has offset USD 3.8 million received from the Russian company for October transit services in excess of the contractual amount against delayed interest arising from Gazprom’s debt to Naftogaz under the transit award of 28 February 2018

Naftogaz has offset USD 3.8 million received from the Russian company for October transit services in excess of the contractual amount against delayed interest arising from Gazprom’s debt to Naftogaz under the transit award of 28 February 2018.

Since Gazprom does not comply with the arbitration award, it pays a certain excess amount for transit services to Naftogaz.

Earlier, Naftogaz withheld USD 18.3 million in overpayments for transit services rendered in August-September. The amount withheld in the past three months thus totaled USD 22 million, in addition to USD 2.1 billion already set off by the Tribunal against Naftogaz’s debt for gas supplied in 2014-2015. Gazprom still owes Naftogaz USD 2.7 billion pursuant to the arbitration award.

Background: On 22 December 2017, the Stockholm Tribunal revised the gas price formula in the gas sales contract between the two parties. This resulted in a lower price of gas for Naftogaz and, consequently, a lower cost of transit services for Gazprom. In February 2018, the Tribunal ruled that Gazprom has to reimburse Naftogaz USD 4.63 billion underpaid for past transit services.

Gazprom persistently refuses to comply with the Stockholm awards and continues to pay a higher transit tariff than that calculated by Naftogaz based on the arbitration award.

Corporate Communications Department
NJSC Naftogaz of Ukraine



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