Finnish energy company Gasum terminates contract with Gazprom

The Finnish company Gasum terminated its contract with Russia’s state-owned gas monopoly Gazprom. According to Kommersant, Finland’s state-owned energy provider is the first European company to have terminated a long-term contract with Gazprom. The contract between Gasum and Gazprom was set to expire in 2031.

In 2021, as part of the agreement, Gazprom supplied Finland with 1.49 billion cubic meters of gas. After the start of Russia’s full-scale invasion of Ukraine and the resulting sanctions, Russia began to demand payment in rubles. Gasum, among other companies, refused. In May 2022, Gazprom stopped delivering gas to Finland.

In response, Gasum initiated arbitration proceedings against Gazprom, stating that it did not agree to the new payment terms and citing insufficient deliveries, which broke the terms of the contract. The arbitration tribunal found the Russian president’s order demanding that “unfriendly countries” make payments in rubles for Russian gas to be a force majeure, allowing Gasum to terminate the contract.