Supreme Court upholds ruling to collect $7.9 mln from Ukrtransnafta in dispute with BelOil
The Supreme Court of Ukraine has turned down a counterclaim of PJSC Ukrtransnafta against a ruling of Kyiv's court of appeals dated April 12, 2018, which upheld the ruling of the international arbitration court of the Belarusian Chamber of Commerce and Industry dated September 1, 2017, which ruled to collect $7.857 million from Ukrtransnafta in favor of CJSC Belarusian Oil Company (BelOil) in the litigation over pumping of oil via the Yuzhny-Brody-Mozyr pipelines.
"The court of lower instance has rightly concluded that statements of Ukrtransnafta that the international arbitration court of the Belarusian Chamber of Commerce and Industry is not authorized to hear the counterclaim of BelOil against Ukrtransnafta to collect the debt in the case opened under the initial claim of Ukrtransnafta against BelOil to collect the debt are groundless," the Supreme Court said in a ruling on October 4.
According to the document, the ruling was issued by a panel of judges of the first trial chamber of the Civil Division of the Court of Cassation.
As reported, the international arbitration court of the Belarusian Chamber of Commerce and Industry ruled to collect $24.021 million of compensation from BelOil for the unused volumes of transportation under the "pump or pay" contract condition and $13.878 million of compensation from Ukrtransnafta for the change of the quality of oil. BelOil won the litigation with $7.857 million in its favor.
BelOil on February 8, 2018 filed a petition to the Kyiv's court of appeals to receive a permit to execute the ruling of the Belarusian arbitration court.
According to an annual report of Ukrtransnafta, the company was waiting the court proceedings will finish by the end of 2018. The company reserved funds of UAH 220.514 million for the execution of the ruling.
BelOil in 2011-2012 was supposed to supply at least 8 million tonnes of oil (4 million tonnes per year) of Azeri Light brand at Yuzhny oil terminal for subsequent pumping of this oil to the Mozyr refinery along the Yuzhny-Brody-Mozyr route in the "pump or pay" mode. Of the planned 4 million tonnes in 2011, only 0.9 million tonnes were delivered and pumped. At the same time, the contract of compensation for quality losses was additionally signed, as BelOil supplied Azeri Light to the Yuzhny terminal, while Urals oil was pumped via the oil pipeline to Mozyr, which is a cheaper grade of oil.