Transit of Russian gas to EU via Ukraine stable – EC

The European Commission says transit shipments of Russian gas to the European Union countries via Ukraine proceed in a normal and stable regime.

When answering a question at a briefing in Brussels on March 6 whether there is any concern about the transit of Russian gas via Ukraine due to the bilateral dispute, European Commission spokesperson Anna-Kaisa Itkonen said that according to the information available, the gas flows to the EU are stable and normal, an UNIAN correspondent reported.

According to Itkonen, the European Commission is ready to help facilitate Ukrainian-Russian negotiations if both sides ask about it.

As UNIAN reported earlier, Russia's gas monopoly Gazprom has lost a lawsuit with NJSC Naftogaz of Ukraine in the Stockholm Arbitration, which ruled Gazprom should pay $2.56 billion to the Ukrainian company. At first, Gazprom agreed to supply 0.5 billion cubic meters of gas to Ukraine in March at prices determined by the arbitration. However, on March 1, it suddenly refused to fulfill its contractual obligations and reduced the gas pressure at the entry point to Ukraine's gas transport system (GTS) on the eastern border to a critical level.

Read alsoGazprom's move to halt cooperation with Naftogaz response to "slap in the face" from Kyiv: DiplomatNaftogaz says Gazprom's failure to fulfill the court's decision has led to a gas shortage in the GTS. To overcome the crisis, Ukraine's Cabinet of Ministers limited gas consumption, while Naftogaz went for an emergency purchase of 60 million cubic meters of gas from Poland's PGNiG.

Thanks to the efforts by Naftogaz and the Cabinet of Ministers, the country has passed this period without any emergencies, maintaining the gas transit volume at the proper level.

The situation with gas supplies had stabilized as of March 3.

UNIAN memo. Ukraine, represented by NJSC Naftogaz of Ukraine, sued Gazprom in a Stockholm arbitration court over the two contracts of 2009: on transit shipments of Russian gas to the European Union and purchases by Ukraine of Russian gas.

On December 22, Naftogaz received the final award of the Arbitration Institute of the Stockholm Chamber of Commerce related to the contract for purchases by Ukraine of Russian natural gas. Thus, the court satisfied a number of demands of the Ukrainian side, including a reduction in the gas purchase price in the second quarter of 2014 by 27.4 %, to $352 per 1,000 cubic meters. It also rejected Russia's Gazprom take-or-pay claims amounting to $56 billion. As not all the demands of the Ukrainian side were satisfied, Naftogaz was left owing Gazprom some $2 billion.

The second ruling concerned the contract for transit shipments of Russian gas via Ukraine, which was signed in 2009. According to the deal, Gazprom was to transport 110 billion cubic meters of gas per year via Ukraine. Since the condition had not been met, Naftogaz demanded that the court recover $16 billion in compensation from the Russian company in this litigation.

On February 28, Naftogaz received the final decision of the Stockholm Arbitration Tribunal ordering that Gazprom should pay Naftogaz $4.63 billion. The award means Gazprom has to make payments to Naftogaz in the order of $2.56 billion after residual payments for gas delivered in 2014 and 2015 have been settled.

At the same time, Gazprom will be fined US$500,000 every day until it pays $2.56 billion to Ukraine.