Ukraine threatens to sue Russian gas supplier

Naftogaz wants to take Gazprom to arbitration, claiming it’s underpaying for gas transit to Europe

Ukraine’s natural gas operator, Naftogaz, plans to file an arbitration lawsuit against Russia’s Gazprom in July due to alleged underpayment for gas transit to Europe, RIA Novosti reported on Tuesday, citing the company’s chief executive Yury Vitrenko.

“The terms of our contract with Gazprom stipulate that we have 45 days to try to resolve our disputes before we can go to arbitration. Next month this period expires and if nothing happens and Gazprom does not change its position, that will mean that we have the right to apply to international arbitration, and we will do it,” the Naftogaz CEO was quoted as saying.

Vitrenko claimed that Gazprom is failing to pay enough for the volumes of gas transit that it has booked.

On May 11, Ukraine suspended the flow of Russian natural gas to Europe via Sokhranovka, a major transit point, citing “interference by the occupying forces.” Prior to that, Russian gas had been flowing uninterrupted through pipelines across Ukraine, despite the conflict.

READ MORE: Ukraine blocks Russian gas flow to Europe

The Gas Transmission System Operator of Ukraine proposed transferring all transit to another entry point, Sudzha in the Kursk region. Gazprom said it could not reroute supplies to Sudzha as the reconfiguration would be “technically impossible.” The Russian company noted that it had fully met all obligations to European consumers, and that transit services had been paid for.

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