Unian | 27 May 2021
Energoatom suing Russia to get compensation for assets lost in Crimea
Energoatom, a state-owned operator of Ukraine’s nuclear power plants, filed a dispute with Russia’s competent authorities in accordance with the agreement reached in 1999 between the governments of Ukraine and Russia on the promotion and mutual protection of investments.
According to the company report, this is about the assets it lost in Crimea, including the Donuzlav wind farm, which is now located in the temporarily occupied territory.
"Back on December 17, 2020, on the initiative of Herman Galushchenko, then vice-president of the company, and now Minister of Energy of Ukraine, an agreement was concluded between SE NNEGC Energoatom and an acclaimed international law firm Shearman & Sterling LLP on the provision of services for the preparation and direction of a dispute notice on behalf of the Company to the Russian Federation. This law firm has previously participated in similar cases against the Russian Federation and has unique experience in resolving complex investment arbitration disputes," the report reads.
According to the procedure, after the Russian side receives the notice, the parties have six months to resolve the disputed issue out of court. If the parties come to no agreement, this dispute may be referred to court (arbitration).
In the spring of 2014, Russia, in violation of international law, annexed the Crimean Peninsula, leading to a number of Ukrainian energy companies losing their assets in the area.
In January 2016, Ukraine’s largest oil company, Ukrnafta, filed a lawsuit against Russia with the International Arbitration Court in The Hague in connection with the loss of its network of 14 filling stations following the annexation move.
In September 2017, Naftogaz reported that the state holding had filed a lawsuit demanding that Russia pay compensation for $5 billion in losses from the annexation. Taking into account the expected interest, the amount of Naftogaz’s claims has reached $8 billion.
In 2018, Ukrenergo notified Russia of filing with the arbitration court a case over the assets lost in Crimea due to the Russian grab in 2014.
In July 2020, the Arbitration Court in Paris (France) started hearing a case on the illegal seizure by the Russian Federation of Ukrenergo’s infrastructure facilities in Crimea.
The state-owned Energoatom is the largest electricity producer in Ukraine with a total production share of over 50% in the total electricity output in the country. Energoatom is an operator responsible for the safety at all nuclear power plants across Ukraine. The country ranks seventh worldwide in terms of the installed capacity of nuclear power units.