Thursday, December 8, 2022

Naftogaz breaks gas contract with Firtash’s Ye Energy, says it could have cost taxpayers $4 billion

by Max HunderNovember 28, 2021 5:49 am

Naftogaz announced on Nov. 26 that it broke its contract to supply 6 billion cubic meters of gas, approximately 15% of Ukraine’s annual consumption, to oligarch Dmytro Firtash’s Ye Energy.

The state-owned oil and gas giant’s communications director, Maksym Bilyavskyi, estimated that Naftogaz could have lost $4 billion if the contract had been allowed to continue through the 2021-22 heating season. It is not clear how much money had already been lost on the deal.

According to Bilyavskyi, Naftogaz was supposed to sell gas to Ye Energy for $0.27 per cubic meter, which is too low. In July, Ukrainska Pravda reported that Ye Energy was planning to sell the gas to industrial consumers for a lot more. In November, gas traded at an average $1.33 per cubic meter.

Firtash has lived under house arrest in Vienna since 2014 after being indicted for bribery by the U.S. government.

Max Hunder
Max Hunder
Business reporter, editor

Max Hunder is a business reporter at the Kyiv Independent. He previously worked as a business reporter at the Kyiv Post focusing on infrastructure and energy. He is a graduate of Eton College and University College London, and has reported for international publications from London, Kyiv and Yerevan.

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