Centragas to proceed to arbitration against the Ukrainian government under the Energy Charter Treaty

The Ukrainian Government has so far failed to respond to Centragas's formal request under the Energy Charter Treaty (ECT) to enter into negotiations over the illegal expropriation of 11bcm of gas belonging to RosUkrEnergo (RUE), a joint venture company 50% owned by Centragas and 50% by Gazprom.

As previously noted in the 26 November 2009 statement of Centragas (see below), advice has been received by Centragas from senior international law firms on this matter confirming both that Centragas, as the 50% investor in RUE, has the legal right to proceed with this claim under the ECT, and that the claim can be brought directly against the Ukrainian Government in its capacity as the 100% owner of Naftogas.

Under the terms of the ECT, to which Ukraine is a signatory and therefore bound by its terms, the Ukrainian Government has a period of 3 months within which to respond to Centragas. This period expires on 9th February.

David Brown, the CEO of Centragas Holding AG said: "I can confirm that we have had no communication whatsoever from any Government source or official in Ukraine in response to our ECT request. I have therefore today instructed our lawyers to prepare to commence the Arbitration process next week. We are determined to hold the Ukrainian Government accountable for their actions and the actions of their State controlled energy monopoly, Naftogas, and that they should honour their obligations under the Energy Charter Treaty. But most of all, we are determined to be compensated for the 11bcm of our gas which they have expropriated from their storage facilities where it was being held under contracts pending transit to our customers in Europe."

David Brown

CEO

Centragas Holding AG