“Gazprom export” and SC “Turkmengas” group signed an agreement on termination of arbitration

“Gazprom export” LLC and SC “Turkmengas” group of companies signed an agreement on termination of arbitration proceedings on January 31, 2019 and sent a notification to the arbitration Tribunal. This is reported in the quarterly report posted on the website of Gazprom.

Until 2009, “Gazprom” was the largest buyer of Turkmen gas, importing about 40 billion cubic meters per year. At that time, it was profitable for “Gazprom” to buy inexpensive Turkmen gas to re-export it to the CIS countries and Europe, receiving significant dividends.

Since 2009, the “Turkmengas” to export the "blue fuel" prices, oriented to the world market. After that, “Gazprom export” sharply reduced the intake of Turkmen natural gas, which, according to Turkmen experts, led to an accident on the CAC gas pipeline. As a result, deliveries were suspended and resumed in early 2010, but in much smaller volumes. Despite the contractual agreements, “Gazprom” began to reduce the volume to the level of 10-11 billion cubic meters per year, and in 2015 the annual volume decreased to 4 billion cubic meters.

The arbitration proceedings began four years ago. In June 2015, “Gazprom export” initiated an arbitration to revise the price of Turkmen gas delivered from 2010 to 2015.

Since the beginning of 2016, “Gazprom” has stopped receiving Turkmen gas, taking a "contract break" until the end of 2018. The arbitration proceedings between “Gazprom export” LLC and SC “Turkmengas” group of companies were also temporarily suspended in order to find a mutually acceptable decision on further cooperation outside the framework of the arbitration process.

Supplies of Turkmen gas to the Russian Federation resumed on April 15, 2019.

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