As deadlines loom, Russia says EU gas clients open payment accounts

LONDON, May 19 (Reuters) – Half of Russian gas giant Gazprom’s 54 clients have opened accounts at Gazprombank, Russian Deputy Prime Minister Alexander Novak said on Thursday, as European companies grapple with how to meet looming payment deadlines without breaking EU sanctions.

Companies in the European Union have been trying to confirm for weeks how they can legally buy Russian gas, after Moscow demanded foreign buyers start paying in roubles and cut gas supplies to Bulgaria and Poland last month after they refused to do so.

Russia has said foreign companies need to open two accounts to comply with its new payment mechanism – one for foreign currency, and one for roubles – and European companies need to complete any currency conversion within 48 hours.

The EU has shared two pieces of written guidance with countries, but neither explicitly said opening rouble accounts would breach EU sanctions against Moscow for its invasion of Ukraine. That has left some companies struggling to understand whether they can open these accounts to buy gas.

Nearly all the supply contracts EU companies have with Gazprom (GAZP.MM) are in euros or dollars and some top Western companies have already opened accounts at Gazprombank. read more

Novak told a forum on Thursday that around half of Gazprom clients have opened special accounts at Gazprombank in foreign currency and in roubles.

“Gas payments under main contracts are due … and there is information that some big companies already opened accounts, paid (gas bills) and are ready to pay on time,” Novak told a forum. “In the next couple of days we will see a final list of who’s paid in roubles and who’s refused.”

Companies have payment deadlines for April gas deliveries from May 20.

‘CLEAR AS MUD’

The European Commission has advised companies against opening a bank account in roubles at Gazprombank to pay for gas, as requested by the Kremlin, but has not explicitly said doing so would breach sanctions in its formal written guidance to governments on the issue, according to officials with knowledge of the matter. read more

European gas prices have been volatile all week due to concerns around how European companies can legally pay for Russian gas supplies.

“After mixed messages emerged from both sides earlier this week, the situation appears as clear as mud,” said Wei Xiong, senior analyst at consultancy Rystad Energy.

Some gas buyers in Europe have taken different positions. Ultimately, EU countries are responsible for complying with the bloc’s sanctions – which were approved unanimously by the 27 member states. Brussels could launch legal action against a government that failed to enforce them.

Italian energy group Eni (ENI.MI) said this week it has started proceedings to open two accounts, one in euros and the other in roubles, to pay for Russian gas. read more

State-controlled Eni said its decision had been taken in concert with the Italian government and in compliance with the sanctions framework.

Uniper (UN01.DE), Germany’s largest importer of Russian gas, said it is transferring euros to an account at Gazprombank to comply with the payment mechanism.

French power firm Engie (ENGIE.PA) said it would make the next payment to the Russian gas giant in euros before the end of the month as both companies have agreed on a solution in line with European sanctions.

Finland’s state-owned energy provider Gasum refused to switch to the new scheme and said this week it would take its dispute over rouble payments with Russia’s Gazprom Export to arbitration proceedings. read more

Reporting by Reuters, Kate Abnett in Brussels, Nina Chestney in London; Editing by Edmund Blair and Barbara Lewis

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