Russian vessel arrested in Norway upon Naftogaz application
A Russian vessel, the «Professor Molchanov», has been arrested in Norway upon a request from Naftogaz Group. The measure was taken as part of international enforcement proceedings against Russia to recover $4.22 billion in compensation for the group's illegally seized assets in occupied Crimea.
This was reported on September 2 by Naftogaz's press service, according to a statement.
The company called the arrest of the vessel another practical step in enforcing the decision of the international arbitration tribunal against the Russian Federation.
«Professor Molchanov» is a Russian research vessel flying the flag of the Russian Federation. It was built in Finland in the early 1980s and is used for expeditions in Arctic waters, including the Svalbard area.
Russia owes Naftogaz more than $4.2 billion plus interest
The basis for the recovery is the decision of the arbitral tribunal at the Permanent Court of Arbitration in The Hague dated April 12, 2023.
The tribunal ordered Russia to pay companies of the Naftogaz Group $4.2229 billion for assets expropriated after the occupation of Crimea. In addition to the principal amount, interest accrues on the debt until full payment.
Including interest, Naftogaz previously estimated the total claims against Russia at more than $5 billion.
The dispute concerns oil and gas assets that belonged to the Ukrainian group in Crimea before the Russian occupation of the peninsula in 2014. Among them were equipment and infrastructure, rights to operate gas pipelines and storage facilities, subsoil use licenses, as well as gas reserves.
Russia has not voluntarily paid compensation
Since Russia refused to voluntarily comply with the arbitration decision, Naftogaz initiated a procedure for the forced recovery of Russian state assets in various countries.
To this end, the group seeks recognition of the arbitration award by national courts in states where Russian Federation property is located, after which it may demand its seizure and sale.
Similar procedures are already underway in several jurisdictions. In Austria, for example, a court has allowed the attachment of more than 20 Russian real estate objects with an estimated value exceeding €120 million. In France, Naftogaz has also obtained recognition of the award and imposed encumbrances on Russian state assets worth more than €120 million.
Previously, Russian assets in the same case were also seized in Finland. In addition, Naftogaz is pursuing recognition and enforcement of the arbitration award in the United States, the United Kingdom and other countries.
Arrest of vessel does not yet mean receipt of money
The arrest of the «Professor Molchanov» does not in itself mean that the value of the vessel has already been transferred to Naftogaz. The arrest restricts disposition of the asset within the enforcement procedure, after which further actions provided for by Norwegian legislation are to follow.
Thus, Naftogaz continues to collect Russian assets in various jurisdictions to subsequently cover the compensation awarded by the arbitration. The enforcement will continue until Russia fully complies with the court's decision, along with accrued interest.
