Report: Kiev, Moscow should define take-or-pay condition

KIEV, Jun 15 (PRIME) -- Ukraine’s Naftogaz Ukrainy and Gazprom should agree how the take-or-pay condition will be applied the end of a long-term contract and on minimal gas purchases after the Stockholm Arbitration Court’s decision, Naftogaz Ukrainy CCO Yury Vitrenko said in an interview to local news agency LIGABusinessInform published on Thursday.

“All Gazprom’s demands under the take-or-pay condition were rejected. All our demands under the take-or-pay term were approved, and we should not pay for the previous volumes of gas that we did not take. The article of the contract regarding the take-or-pay condition should be changed in the future in line with principles that were stated by the tribunal and in line with our demands,” he said.

The amended contract should include the take-or-pay condition, but its principles should not be excessive, and Naftogaz Ukrainy and Gazprom should define how the contract will work further with these principles. If the companies fail to agree on the minimal amounts of gas for which Naftogaz Ukrainy will have to pay to Gazprom, the arbiter panel will set them, he said.

He also said that the contracted gas price should be revised retroactively from April 2014 and should be lower than the price at a market of a European country, and it will be lower than the price for which Naftogaz Ukrainy currently buys gas in Europe.

On May 31, Ukraine’s Deputy Foreign Minister Yelena Zerkal said that the court cancelled the take-or-pay condition of the contract, allowed Kiev to re-export gas, and ordered a revision of the gas price retroactively from 2014. Gazprom said that the decision was interim and the company needs time to analyze the document.

On June 6, Gazprom Deputy CEO Alexander Medvedev denied the statement that the court lifted the take-or-pay condition, and said that the balance of the decision tips the scales in favor of Gazprom, but the balance will be defined only by a final decision of the court.

The court is yet to publish the text of the decision.

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