Brattle Client Naftogaz Successful in Securing Set-Aside of Take-or-Pay Claims in Arbitration over Gazprom Contract

The Brattle Group’s client Naftogaz, the national oil and gas company of Ukraine, was successful in securing the set-aside of take-or-pay claims in the arbitration over their gas supply contact with Russia’s Gazprom.

The Brattle Group’s client Naftogaz, the national oil and gas company of Ukraine, was successful in securing the set-aside of take-or-pay claims in the arbitration over their gas supply contact with Russia’s Gazprom.

Naftogaz initiated a dispute regarding the price it was paying for gas to Gazprom and Gazprom counter-claimed in respect of the gas that Naftogaz had been unable to consume but for which it was committed to pay. The result was Naftogaz faced a claim for more than $44 billion in “take-or-pay” penalties.

Brattle economists Serena Hesmondhalgh and Carlos Lapuerta were instrumental in achieving a retrospective reduction in the contract price that amounted to nearly 30% in mid-2014 and having the take-or-pay claim completely dismissed, essentially on competition grounds.