Finland scraps pipeline gas supply deal with Russia

Finnish state energy company Gasum announced on Monday that it has terminated a long-term natural gas contract with Russia’s Gazprom Export after the sides were unable to resolve an issue with payments.

The move follows Gazprom’s suspension of pipeline-based natural gas deliveries to Gasum in May 2022 over the latter’s refusal to make payment in rubles. In response to EU sanctions last year, Moscow demanded that buyers in countries that supported the restrictions pay for Russian gas supplies in rubles instead of dollars or euro.

“The parties were not able to resolve the situation within the period defined by the arbitral tribunal…” the Finnish company’s statement reads.

The termination concerns only pipeline supply, whereas “the long-term LNG supply contract Gasum has with Gazprom Export remains in place,” it specified.

Gazprom confirmed it had been notified about the Finnish energy provider’s decision, saying it “is conducting a legal analysis of further steps in this matter,” Reuters reported.

Data from the Finnish customs service showed that Gasum has bought around $188 million worth of natural gas from Russia since February 2022. Gazprom supplied the company with 1.49 billion cubic meters of gas in 2021, representing two-thirds of Finland’s total consumption.

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