Naftogaz expects to recover from Russia $8 bln over assets seized in Crimea

UNIAN | 12 March 2018

Naftogaz expects to recover from Russia $8 bln over assets seized in Crimea

NJSC Naftogaz of Ukraine may recover from Russia as early as this year nearly $8 billion in damages over the seizure of the company’s assets in Crimea following the illegal annexation of the peninsula in the spring of 2014. "Indeed, this year we can win up to $8 billion. But then there will be a question of how we are going to take it," Naftogaz chief commercial officer Yuriy Vitrenko wrote on Facebook.

According to Vitrenko, the defendant is the Russian Federation. Ukraine’s claims amount to $5 billion, which, added the penalties, will total $8 billion. As UNIAN reported earlier, in the spring of 2014, Russia, violating the norms of international law, seized the Crimean peninsula.

Following the annexation, Ukraine’s Chernomornaftogaz lost its key assets (in particular, the "Petro Hodovanets" and "Ukraine" drilling rigs), as well as their access to natural gas deposits on the Black Sea shelf.

To protect company interest, Naftogaz initiated in October 2016 arbitration proceedings in accordance with the Agreement between the Cabinet of Ministers of Ukraine and the Government of the Russian Federation on the promotion and mutual protection of investments, better known as the Russian-Ukrainian bilateral investment agreement.

In mid-January, 2017, Naftogaz attracted international law firm Covington & Burling LLP, the one with positive experience in protecting clients’ interests in litigations against Russia and Russian state-owned companies.

On September 20, 2017, Naftogaz reported that they had filed a lawsuit with the International Court of Arbitration at the Permanent Court of Arbitration in The Hague (Netherlands) demanding from Russia a $5 billion compensation for damages incurred by the company as a result of Russia’s illegal seizure of Naftogaz’s assets in Crimea. It was also reported that the court was set to hand down a decision on the case before the end of 2018.

source: UNIAN