Leaked contract reveals Gazprom can cut supplies to Moldova unless historic debt is settled by May

Leaked contract reveals Gazprom can cut supplies to Moldova unless historic debt is settled by May
By Iulian Ernst in Bucharest February 23, 2022

Gazprom can terminate its contract with Moldovagaz and discontinue gas supplies to Moldova unless the sides settle the issue of the historic debt — estimated at $900mn by the Russian side — by May 1, according to provisions of the memorandum attached to the contract signed last November by the two companies and by the Moldovan government and leaked to media on February 22.

The contract was supposed to be confidential and speculation about its content has so far concentrated on the formula for the gas price calculation. But other provisions have surfaced attracting public attention, such as the provision on the settlement of the historic debt.

Another provision, regarding the deliveries of gas to the Moldovan separatist republic of Transnistria, also raised public concerns. Under the provision, Moldovagaz takes full responsibility for the gas delivered to the separatist region of Transnistria “if a bilateral contract is signed”. Transnistria already owes $7bn in unpaid gas bills under a political agreement with the Russian authorities, which has an uncertain legal and commercial formulation.

To dissipate public concerns about Moldovans paying for the gas delivered to Transnistria, Moldovagaz promised to publish the contract it has with Tiraspoltransgaz, the company that operates the gas distribution and transport network on the separatist territory.

“Only Tiraspoltransgaz is responsible for fulfilling its direct financial obligations towards Moldovagaz," the CEO of Moldovagaz Vadim Ceban stated.

The former leader of the Dignity and Truth political party, Andrei Nastase, declared in a live broadcast, that according to the contract leaked to the press, Moldovans on the right bank of the Dniester "are obliged to pay the bills of those on the left bank of the Dniester [Transnistria]".

Separately, Ceban announced that he had initiated an internal investigation after the contract with Gazprom was leaked to the media. He claimed that "leakage of information which constitutes a trade secret jeopardises the fulfilment of the contractual obligations between Moldovagaz and Gazprom and the energy security of the country as a whole".