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20 Jan, 2016 11:51

Gazprom bills Ukraine's Naftogaz $2.5bn for gas not bought

Gazprom bills Ukraine's Naftogaz $2.5bn for gas not bought

Gazprom has sent a $2.5 billion bill to Ukraine’s state gas company Naftogaz for failing to buy the contracted amount of gas in the third quarter of 2015.

Russia's gas monopoly says that according to the 'take-or-pay' terms of the contract, Kiev has to buy a minimum quantity of gas annually or face a penalty. Ukraine was obligated to buy 10,485 billion cubic meters in the third quarter of 2015, according to Gazprom.

Naftogaz claims the way the 'take-or-pay' obligations are formulated in the contract with Gazprom are non-market oriented, illegal and invalid.

“The validity of the claims of Gazprom based on the 'take-or -pay' principle will be determined in court,” said a company statement released on Tuesday.

Naftogaz is determined to challenge the application of the clause in the court of the Arbitration Institute of the Stockholm Chamber of Commerce.

Ukraine has been trying to decrease its reliance on Russian gas and its purchases dropped significantly last October.

READ MORE: Kiev hikes transit fees for Gazprom

"In 2015, Ukraine actually refused to buy Russian gas in the third quarter and there was no agreement the 'take-or-pay' rule was not to be applied in that period," said Gazprom CEO Aleksey Miller.

Ukraine has ten days to pay the bill, Gazprom said on Tuesday.