Tatneft wins $112m compensation from Ukraine
MOSCOW, August 26, 2014
Russian oil producer Tatneft has been awarded $112 million in compensation from Ukraine over a refinery ownership dispute by an international arbitration court, piling pressure on cash-strapped Kiev, the company said.
The mid-sized producer has been involved in a legal dispute over ownership of Ukraine's Kremenchug oil refinery (Ukrtatnafta), Ukraine's largest. The plant's former managers used armed police to oust managers friendly to Tatneft, citing a court order, in 2007.
Tatneft, based in the Republic of Tatarstan, 1,000 km (625 miles) east of Moscow, had appealed to an arbitration court seeking compensation of more than $1 billion due to the effective loss of the ownership of the refinery, which has a capacity of 120,000-145,000 barrels per day.
The company, which had directly and indirectly controlled over 30 per cent in Ukrtatnafta since the 1990s, said in a regulatory filing that the court had found that Ukraine's government broke an intergovernmental agreement with Moscow and awarded compensation to Tatneft of $112 million plus interest.
The decision puts more economic pressure on Kiev, which is fighting pro-Russian insurgency in the east of the country, a conflict draining the economy by the day.
Tatneft also said its second-quarter net profit rose about 82 per cent year-on-year, to 27.2 billion roubles ($753 million) on the back of a 22 per cent increase in revenue to 128 billion roubles thanks to lower taxes. - Reuters