Kazakhstan Court Overturns Ruling on $1.4B Award Against Gazprom in Favor of Naftogaz

A special court in Kazakhstan has overturned its earlier ruling that permitted Ukraine's state-owned oil and gas company Naftogaz to enforce a $1.4 billion international arbitration award against Russia's Gazprom.

In May, a court at the Astana International Financial Centre (AIFC) recognized and upheld a Swiss International Commercial Court (ICC) arbitration award in favor of Naftogaz. Shortly after, Kazakhstan's Justice Ministry stated it would not enforce the decision, arguing it had "no legal connection to the country." On Tuesday, an AIFC judge threw out the special court's original ruling, ruling that the court lacked jurisdiction to enforce the award. Naftogaz and Gazprom were ordered to submit written arguments on costs within 14 days.

The underlying commercial dispute stems from a 2019 contract covering Russian natural gas transit through Ukraine. Following Russia's full-scale invasion in 2022, transit via the Sokhranivka distribution station in the eastern Luhansk region was suspended, though deliveries continued through the Sudzha entry point. In 2022, Naftogaz declared force majeure, halting gas supplies to Europe. Gazprom deemed the Ukrainian company's justification insufficient to terminate the agreement and subsequently stopped fully paying for services under the transit pact.

Naftogaz initiated arbitration proceedings in Switzerland in September 2022. In June 2025, arbitrators ordered Gazprom to pay Naftogaz $1.4 billion in unpaid gas transportation fees and cover legal costs. Gazprom sought to overturn the ruling, but Switzerland's Federal Supreme Court upheld the award in March 2026, making the decision final.

The AIFC court, which operates independently from Kazakhstan's legal system, is modeled after English common law and is staffed largely by international judges, most from the United Kingdom.