Gazprom sends official proposal to Naftogaz Ukrainy on gas transit

MOSCOW, Nov 18 (PRIME) -- Russian gas giant Gazprom has sent an official proposal to Ukrainian energy company Naftogaz Ukrainy to prolong the existing contract on gas transit or to sign a new transit contract for one year taking into account the forecast for gas demand in the E.U., Gazprom said in a statement on Monday.

“Today, Gazprom sent an official proposal to Naftogaz Ukrainy…on prolongation of the existing contract or signing a new contract on transit of gas through the territory of Ukraine for one year taking into account forecasted demand of European buyers of gas for 2020,” the statement read.

The preconditions for prolongation of the contract or signing a new one include abandoning mutual claims in international arbitration and terminating court proceedings; cancelling a fine imposed on Gazprom by Ukraine’s antimonopoly committee; withdrawing a motion asking the European Commission to launch an investigation against Gazprom, the company said.

Gazprom is also waiting for Naftogaz Ukrainy’s position on its readiness to buy gas directly from the Russian company starting from 2020.

Ukraine stopped direct purchases of Russian gas in 2015. The current gas supply and transit contracts between the countries expire at the end of 2019.

The Ukrainian antimonopoly committee imposed a $3.4 billion fine on Gazprom in 2015 to punish the company for its monopolist position on the gas transit market. In October 2016, the fine was increased to $6.4 billion for a jeopardized payment. Gazprom contested the fine as it does not operate on the market of Ukraine, but all appeals within the country were futile.

In 2018, the Stockholm arbitration court ruled that Gazprom must pay Naftogaz Ukrainy $2.56 billion for non-shipment of gas. Gazprom appealed against the decision in March and in May demanded full abolishment of the decision. Hearings of the appeal in Sweden are scheduled for September–October 2020.

Earlier in November 2019, Naftogaz Ukrainy filed another suit against Gazprom to the Stockholm court demanding a $12 billion compensation for discontinuation of transit across Ukraine.

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