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Stockholm arbitration rejects Gazprom's "take or pay"

Naftohaz Ukrayiny is jubilant.

Stockholm arbitration rejects Gazprom's "take or pay"
Photo: EPA/UPG

The Arbitration Institute of the Stockholm Chamber of Commerce has granted a full victory to the Ukrainian oil and gas company Naftohaz Ukrayiny challenging the fairness of the "take or pay" clause forced on Ukraine as of 2009 under the gas supply contract with Russia's Gazprom, Naftohaz's press service has said on Facebook.

Thus the court upheld Naftohaz's demand to have the price revised with regard to market conditions. It also cancelled the ban on gas re-export.

"Our main interest in this case is for gas supplies to Ukraine to be based on European principles and the rules of the gas market functioning, as required by our national legislation, the Energy Community Treaty, and the EU-Ukraine association agreement. The only company to aggressively oppose this is Gazprom," Ukrainian Deputy Foreign Minister Olena Zerkal said on Facebook.

By 29 May, the monetary compensation claims under the sale and purchase contract and the transit contract between Naftohaz Ukrayiny and Gazprom have amounted to 30.3bn dollars, Gazrom's claims to the Ukrainian company – 47.1bn dollars.

When the Stockholm arbitration made its decision known on 31 May, Naftohaz Ukrayiny CEO Andriy Kobolyev was jubilant. "We did it," he said on Facebook, linking the post to "We are the champions!" by Queen.

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