Ukraine’s state-owned gas firm Naftogaz announced on Thursday that Moscow had been ordered by an arbitration court in The Hague to pay $5 billion in compensation for wrongfully expropriating its assets in Russian-annexed Crimea in 2014.
Naftogaz CEO Oleksiy Chernyshov called Wednesday’s judgment by The Hague’s Arbitration Tribunal at the Permanent Court of Arbitration a “key victory on the energy front” and predicted more favorable rulings for Ukraine.
Naftogaz claimed the Arbitration Tribunal ordered Russia to reimburse it for $5 billion in damages notwithstanding Russia’s obstruction.
“Russia must now comply with this decision in accordance with international law,” it stated.
In 2014, Russia invaded Crimea and imposed Western sanctions.
Russia and Gazprom (GAZP.MM) didn’t comment on the judgment. The Hague Court did not respond to a written request for comment.
If Russia didn’t pay, Naftogaz said it would start a “process of recognition and admission to enforce the award in the territory of those states where assets of the Russian Federation are located.”
The business, which owned Chornomornaftogaz, a Black Sea gas producer in Crimea, did not specify which Russian assets it may target abroad. After the Ukraine incursion, nations targeted Russian oligarchs’ superyachts and other overseas assets.
It claimed Naftogaz had launched arbitration procedures with six other firms in the Naftogaz Group in October 2016. The arbitration judgment was issued following hearings to determine compensation, which finished in March 2022.
BlueBay Asset Management analyst Tim Ash called the judgment a “huge legal win for Ukraine, and I would think more (is) to come.”
Naftogaz is negotiating a debt restructuring with investors to end its months-long default.
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