Novatek presses Gazprom from Lipetsk

Next year, Novolipetsk Steel (NLMK) of Vladimir Lisin will change its gas supplier, left Gazprom and signed a contract with Novatek. Perhaps, in conditions of surplus on the market and start of gas exchange trading, NLMK achieved more favorable contract terms than it had with Gazprom. This transaction will allow Novatek to close a part of the gas volumes, which will be free since the next year after the expiration of the contract with Inter RAO UES.

NLMK has signed a five-year contract with Novatek for the supply of gas, the company reported yesterday. The contract amount is 2.8 billion cubic meters per year, it will enter into force from 2016 and will cover "100% of the needs of Russian enterprises of Novolipetsk Steel". Now NLMK has a valid contract with Gazprom. The metallurgical company reported to the Kommersant that under the contract with Gazprom NLMK has the opportunity "to buy 2.6 billion cubic meters of gas per year, but this year NLMK began to actively buy gas at SPIMEX, and "in several months the purchases covered 70% of the needs". NLMK doesn’t disclose the reasons for the transfer to the purchase from Novatek and the contract price, but says that the principle of take-or-pay is not included in the contracts.