The Polish PGNiG won against Gazprom in the Swedish Court of Appeal: it rejected the Russian company’s request to cancel the decision on the price of gas supplied under the Yamal contract, PGNiG reports.
“PGNiG won against Gazprom in the Swedish Court of Appeal. The Stockholm Court of Appeal rejected Gazprom’s request to cancel the Arbitration Court’s decision on the price of gas supplied under the Yamal Contract, which was rendered in favor of PGNiG,”the report says..
“We are satisfied with the decision of the Swedish court, which completely rejected Gazprom’s accusations. Almost seven years after the start of the arbitration proceedings of PGNiG against Gazprom, the case has come much closer to full completion,” said Pavel Mayevsky, Chairman of the Management Board of PGNiG SA, whose words are quoted in the release.
It is noted that Gazprom demanded to cancel the final decision of the Stockholm Arbitration Court of March 30, 2020 (on reducing the contract price for gas supplied by Gazprom on the basis of a natural gas purchase and sale contract to Poland dated September 25, 1996), arguing that the court exceeded its authority to resolve disputes between the parties under the Yamal Contract. The Court of Appeal rejected Gazprom’s arguments and found the petition unfounded. In addition, the court ruled that Gazprom must reimburse PGNiG for the costs of legal representation. Due to the precedent nature of the case, the right to file a cassation appeal to the Supreme Court was granted.
The decision of the Arbitration Court in Stockholm, which Gazprom contested, concerned the revision of the price conditions under the Yamal Contract from November 2014 on the basis of a request from PGNiG for a revision of prices. In May 2015, due to the impossibility of reaching a settlement agreement, PGNiG filed a request for arbitration against Gazprom, and in February 2016 submitted a statement of claim. In March 2020, the arbitration made a decision, changing the formula for the price of gas supplied under the contract. In June 2020, Gazprom challenged this decision on formal grounds.
Gazprom, as a result of the arbitration decision, reimbursed the Polish company $ 1.5 billion in a new settlement for the gas already supplied in accordance with the price formula determined by the Arbitration Court. PGNiG used the recovered amount, in particular, to develop its own exploration and production activities on the Norwegian continental shelf, including the acquisition of 21 licenses owned by INOES E&P Norge, which corresponds to the company’s strategy to diversify gas sources and routes, the report also notes.