SPP flags up risk of getting sued by Gazprom if it breaks gas supply contract

Slovakia’s state-owned gas importer SPP has raised concerns that Gazprom could demand up to €16bn ($18.4bn) in compensation if Bratislava terminates its long-term gas contract early under an EU initiative to phase out Russian gas imports by the end of 2027.

SPP’s contract with Gazprom is valid until 2034, but the company warned on June 17 that the Russian supplier may still seek damages even if a EU import ban triggers a force majeure clause.

Slovakia takes 3-5bn cubic metres (bcm) of gas annually from Gazprom under the contract, covering the majority of its gas demand. Bratislava has resisted cutting ties with Russian energy, arguing that a rapid exit from Russian gas and oil could push up prices across Europe and put energy security at risk.

While the EU pushes for a complete halt to Russian fossil fuel imports, Slovakia continues to press for flexibility in the bloc’s energy transition strategy.

Gazprom has filed claims against a number of its other former gas customers and partners in the past few years for contract violations, including Germany’s Uniper, the Czech Republic’s Net4Gas, the Netherlands’ Gasunie and various others. Sometimes these cases have triggered countersuits.

However, in the absence of legal cooperation between Russia and Western jurisdictions, these claims and counter-claims are likely to remain unenforceable and unpaid.

Other resistance to the EU’s plans could come from major importers of Russian LNG such as Belgium, France and the Netherlands.