It was reported on 15 August that “Turkmengaz” filed a lawsuit against Iran-based NIGC to the International Court of Arbitrations.
Turkmenistan has accused Iran of the failure to pay back the debt which, according to various estimates, range from $1,5 to $2 billion.
The Iranian news outlet IRNA reports that Iran’s complaint, in its turn, primarily focuses on Turkmenistan’s cutting off the gas without prior notice, low quality of the gas, and the high price.
According to NIGC, pursuant to the contract when the price of the Turkmen gas amounted to 40 dollars per thousand cubic meters, Turkmenistan increased the agreed price eight-fold in late 2008.Let us recall that an abnormally cold winter was recorded in Iran in 2008-2009 and in this connection the NIGC was urged to purchase additional volumes of gas from Turkmenistan.
The Turkmen side claims that the low price applied only to the volume stipulated by the contract. The additional volume purchased by Iran was sold at the market price.
Apart from the price, Iran is also discontent with the gas quality. The NIGC said that a swap deal had been concluded with “Turkmengaz” Iran supplied its gas to Azerbaijan in exchange of Turkmen gas imports. For some time the quality of Turkmen gas was extremely low.
It is expected that it will take about two years for the court to conclude and there will be no gas export from Turkmenistan during this period.