July 6, 2018 / 3:21 PM / 9 months ago

Ukraine's Naftogaz submits $11.6 billion claim over Gazprom transit contract

KIEV (Reuters) - Ukraine’s oil and gas firm Naftogaz said on Friday it had submitted a claim to the Stockholm arbitration court for more than $11 billion from Russian gas giant Gazprom related to a transit contract.

The move ramps up a long-running legal dispute between the two countries that has run alongside Ukraine’s broader political stand-off with Russia.

Naftogaz said that due to changes in the European gas market it had sought in March to renegotiate the tariff it receives from Gazprom for transit of gas to Europe across Ukrainian territory.

“Gazprom has not been constructive in the negotiations, compelling Naftogaz to refer the matter to arbitration as provided for in the contract,” Naftogaz said in a statement.

It gave a preliminarily estimate of the value of the claim at $11.6 billion.

In February, the Stockholm court ordered Gazprom to pay more than $2.5 billion to Naftogaz over a different contractual dispute. The decision was meant to conclude a long legal battle, but Naftogaz says Gazprom has not complied with the ruling.

Ukraine and Russia have had a complex dispute over gas issues for years, which blew up when the two countries became enemies after a pro-Russian leader of Ukraine was toppled in 2014.

Last year, Gazprom supplied a record high 194 billion cubic meters (bcm) of gas to Europe, excluding former Soviet states and Turkey. Transit of Russian gas via Ukraine jumped by almost 14 percent to 93.5 bcm.

Reporting by Vladimir Soldatkin; Writing by Maria Tsvetkova and Alessandra Prentice; Editing by Alexander Smith and Mark Potter

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