State-run GAIL on Friday said that it has filed an arbitration case against a former unit of Russian gas giant Gazprom, SEFE Marketing & Trading Singapore, seeking damages to the tune of $1.8 billion for non-supply of liquefied natural gas (LNG).
In a BSE filing, the country’s largest gas utility said that it filed the claim in the London Court of International Arbitration on November 30, 2023 in a dispute related to the non-supply of LNG cargoes to GAIL under a long-term LNG contract seeking claims of up to $1.817 billion and alternative reliefs including non-monetary reliefs.
In 2012, GAIL inked a 20-year deal with Gazprom to buy 2.85 million tonnes (mt) of LNG. The supplies commenced six years later and were to reach full volume in 2023.
Gazprom Marketing and Trading Singapore (GMTS) had signed the deal on behalf of Gazprom. GMTS was moved to Gazprom Germania in early April 2022, after Gazprom gave up the ownership of the German unit (Sefe). Subsequently, the former Gazprom unit defaulted on LNG supplies to India.
The supplies to GAIl stopped after the West slapped sanctions on Russia for its February 24 (2022) invasion of Ukraine, leading to a force majeure and stopped supplies to India from June 2022. The LNG supply to GAIL was resumed by Sefe in April this year.