Saipem and Gazprom go to court over cancelled Black Sea pipeline project

Italian oilfield services provider Saipem has taken Gazprom to court over the cancelled Black Sea pipeline project. Saipem is seeking 759 million euros from South Stream Transport, a subsidiary of Gazprom.

According to a document found on Saipem’s website, on November 10, 2015 Saipem S.p.A. served a request for arbitration against South Stream Transport B.V. at the ICC of Paris. The company’s claim amounted to approximately €759 million.  Saipem’s notice to the ICC of the request for to South Stream Transport BV took place on December 15, 2015.

To remind, Saipem had won the contract for the construction of the South Stream gas pipeline in the Black Sea, which had been planned to carry Russian gas to EU, however, the project was afterwards cancelled due to a pressure from the EU.

After the cancelled construction of the South Stream, Turkey and Russia signed a deal to build a gas pipeline to Turkey, with Saipem as the company to do a part of the job. However, in July 2015, Gazprom cancelled the Turkish Stream pipeline construction contract it had with Saipem, citing inability to reach agreement on many working and commercial matters of the project.

On top of that, several months later, Turkey shot down a Russian warplane, citing a breach of its airspace, which lead to the cooling in relations between the two countries, eventually leading to the whole Turkstream project to be dropped.

In December 2015,  RIA Novosti cited the Russian Energy Minister, Aleksander Novak, who said that intergovernmental negotiations between Turkey and Russia on the Turk Stream project have been suspended.

Regarding the Saipem claim, in an e-mail sent to Offshore Energy Today on Tuesday, a South Stream Transport spokesperson said: “Saipem S.p.A. has filed a request for arbitration in a dispute over a contract with South Stream Transport B.V.  South Stream Transport has sought to resolve this dispute amicably with Saipem, and regrets that Saipem has chosen to resort to arbitration. South Stream Transport will defend the claim in its entirety.”

 

Offshore Energy Today Staff

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