Supervisory Boards of the National Joint-Stock Company Naftogaz of Ukraine and new operator of Ukraine's gas transmission system (GTS), namely PJSC Mahistralni Gazoprovody Ukrainy [Trunk Gas Pipelines of Ukraine], have reached an agreement on a roadmap of cooperation towards a full and transparent unbundling of Ukraine's gas transmission function in early 2020.

"Supervisory Board of Naftogaz of Ukraine is pleased to announce it has reached an agreement with the Supervisory Board of Mahistralni Gazoprovody Ukrainy (MGU) on a roadmap of cooperation towards a full and transparent unbundling of Ukraine's gas transmission function," the company's press service said in a statement.

"This is a critical milestone that will ensure Ukraine is in compliance with EU regulations while guaranteeing Ukraine's energy security and economic prosperity," Chairperson of Naftogaz Supervisory Board Clare Spottiswoode said.

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Under the agreed Memorandum of Understanding, the unbundling process is to be finalized at the beginning of 2020, after the existing transit contract with Gazprom expires, the company's press service added.

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As UNIAN reported earlier, in early November 2016, the Cabinet of Ministers adopted a decision on the creation of new operator of Ukraine's GTS, namely PJSC Mahistralni Gazoprovody Ukrainy. At the same time, Naftogaz management created a new subsidiary, the Operator of the Ukrainian GTS, within the structure of Ukrtransgaz.

Naftogaz also attracted the Polish division of PwC as a project manager of the unbundling.

Naftogaz believes that the establishment of a new legal entity and the involvement of a European partner in its management is necessary for European companies to be able to buy gas on the eastern border of Ukraine and transfer it to the European market, preserving transit volumes after the current contract with Gazprom expires.

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On February 28, Naftogaz received the final award of the Arbitration Institute of the Stockholm Chamber of Commerce related to the lawsuit filed by the Ukrainian company against Russia's gas monopoly Gazprom, according to which the latter shall pay $4.63 billion to Naftogaz. In total, Gazprom owes the Ukrainian company $2.56 billion.

At the same time, the Stockholm Arbitration retained Naftogaz of Ukraine as a counterpart of Russia's Gazprom in the gas transit contract.

The transfer of the transit contract to the new operator was important for Naftogaz unbundling reform and creation of a new independent GTS operator.