“Gazprom” has received a claim for € 759 million for the abandonment of the “South Stream” – RBC

section of the pipeline “South Stream” in Serbia

Photo: Bloomberg

Invitation to arbitration

Saipem sent a request for arbitration with the International Chamber of Commerce in Paris against controlled by “Gazprom» South Stream Transport BV In November 2015, the materials for investors Italian contractor with whom acquainted RBC. South Stream Transport – operator of the construction of the underwater part of “South Stream”, which should pass under the Black Sea, bypassing Ukraine, but was never implemented. Saipem requires it to € 759 million.

The company said that this complaint may be included in the overall claim for damages for breach of contract and penalties with a subsidiary of “Gazprom”, the amount of damage is calculated has not yet completely. For 15 December South Stream Transport has been notified of the impending arbitration process, the materials Saipem.

P redstavitel South Stream Transport RBC through the official representative of “Gazprom”, the company received notice by Saipem for filing a claim to arbitration because of a dispute on the contract for the construction of the “South Stream”. South Stream Transport tried to negotiate a settlement of the dispute by peaceful means, but the Italian contractor decided to sue, he added. South Stream Transport intends to defend their interests and fully contested claims Saipem, claims a representative of . D Details litigation representative of South Stream Transport declined to comment.

Dear “South Stream”

«South Stream” – unrealized project of gas pipeline bypassing Ukraine through the Black Sea to South and Central Europe, the estimated capacity of 63 billion cubic meters. per year. Construction pipes in the Russian territory began in 2012. It was assumed that at the end of 2015 on the “South Stream” will be delivered first gas. At full capacity the pipeline was planned to withdraw in 2018. According to the director East European Gas Analysis Mikhail Korchemkin, the total cost of construction of the “South Stream” in Russia totaled € 13 billion, and in view of the preparatory work in Europe – € 17-20 billion. After abandoning the construction of the “South Stream”, “Gazprom “I paid another 56 billion rubles. (about $ 1 billion at the time of declaration) European partners – Eni, Wintershall and EdF – for they own 50% South Stream Transport, reported the Russian company in March 2015. These conditions have been registered in the shareholders’ agreement.

Saipem, which has already participated in major projects of “Gazprom» (Nord Stream under the Baltic Sea and the Black Sea “Blue Stream” Turkey) in March 2014 was elected as the general contractor for construction of the first line of the underwater part of the “South Stream” under the Black Sea from Russia to Bulgaria. “Gazprom” estimated contract value “around € 2 billion.” In addition to the development of documentation and construction of the first line of the contractor had to build a technological objects on the beach and arrange plots crossing the coastline. A month later Saipem, together with the Swiss Allseas Group signed a contract for the construction of the second line (in Italian contractor’s task was to “ensure the construction”), its amount was not disclosed. But the pipeline has not been built because of the claims of the European Union, claiming that the “South Stream” does not conform to the Third Energy Package. Officially, the project was closed December 1, 2014.

In place of the “South Stream” came “Turkish Stream” (had to pass also under the Black Sea, but in Turkey), to implement that “Gazprom” has also decided to draw Saipem. For simple vessels of the Italian company in the Bulgarian Burgas “Gazprom” even paid about $ 300 million, wrote “Vedomosti”. But soon after the company’s fleet in June 2015 came from Bourgas to Anapa to start construction, “Gazprom” has terminated the contract and – because of commercial disputes. But after the Turkish aircraft was hit by a Russian fighter jet in November, and the relations between Moscow and Ankara have deteriorated, the construction of “Turkish Stream” had to be postponed indefinitely.

What do you think the Italians

According to materials of Saipem, in 2014 the company has been paid under contracts for the “South Stream» € 495 million for the first quarter of 2015 – another € 300 million. All to terminate the contract with South Stream Transport document is estimated at € 1,2 Bln. Claim in € 759 million consists of the assessment work already done (for the construction of the “South Stream”), RBC reported a source in the Italian company. According to him, this amount can be increased – due to damage due to termination of contract and penalties. Saipem spokesman did not respond to a request to RBC.

According to the source of RBC in “Gazprom”, familiar with the details of the project “South Stream”, Saipem requires full payment of the termination of the contract in a € 1,2 Bln. But the Russian company is willing to pay only for the work performed (and admits not all invoices Saipem) and penalty. The total amount recognized by “Gazprom”, the interlocutor of RBC did not name, but said that it is “more than € 700 million,” net of the listed Saipem funds.

The partner of law firm UST Alexander Bolomatov indicates that the International Arbitration of the International Chamber of Commerce in Paris – one of the most prestigious and expensive arbitration in Europe, which for a long time and carefully consider such things. If Saipem and South Stream Transport prescribed in the contract clauses for reimbursement in the event of early termination of the contract on the initiative of the customer, the chances of an Italian contractor in the high court, he said. Surely Saipem may receive compensation of their expenses actually incurred, proven by relevant documents, but it can be much lower than requested in the lawsuit, adds lawyer.

Director the consulting of East European Gas Analysis Michael Korchemkin believes that the amount of the claim Saipem already includes debts for simple vessels and agreed compensation for early termination of the contract. In the case of settlement of the dispute by peaceful means “Gazprom” can ask Saipem discount on another project – Nord 2 Stream under the Baltic Sea. In mid-January predpravleniya monopoly Alexei Miller said that the Italian contractor – one of the contenders for the construction. But the tender has not been announced. Representatives of “Gazprom” and Saipem did not comment, affect whether a lawsuit in the International Arbitration on their further cooperation.