UK Court Freezes Nord Stream Dividends

The British High Court has issued a ruling preventing Russia’s Gazprom from collecting $145mn in potential dividends from the Nord Stream gas pipeline.

The order was requested by Ukraine’s Naftogaz, which is ramping up pressure on Gazprom to settle a $2.5bn arbitration award. Naftogaz said in a statement on July 5 that Gazprom would need to transfer the $145mn sum to the court “as a guarantee of meeting the court’s requirements.” The same court in March ordered Gazprom not to withdraw its assets from the jurisdictions of England and the Netherlands.

Gazprom and Naftogaz have been locked in a dispute over their long-term contracts for gas transit and supply for years. A Stockholm arbitration tribunal ruled last year that Gazprom must pay Naftogaz $2.5bn for violating the pair’s transit agreement, but the Russian group has appealed the decision. This appeal will be heard by a Swedish court next year.

Gazprom owns a 51% stake in Nord Stream, which pumps up to 55bn m³/year of Russian gas under the Baltic Sea to Germany. Its partners in the venture are Germany’s Wintershall and Uniper, the Netherland’s Gasunie and France’s Engie.