Iran to sue Turkmenistan for violating gas deal

Published: 05 December 2016

National Iranian Gas Company (NIGC) announced on Wednesday that it will sue Turkmenistan for violating the terms of the gas deal between the two countries.

Turkmenistan has halted gas supplies to Iran since Jan. 1, Shana reported.

The company further said that the Turkmen Foreign Ministry's intervention in a legal case between the Iranian and Turkmen sides on the gas deal is a violation of agreements signed by the two countries 20 years ago, NIGC statement said.

Over the past several years, the NIGC has paid for Turkmenistan gas and has paid off a part of past debt, which amounted to $4.5 billion, the company said.

It added that the debts go back to the years when Iran could not pay in cash due to sanctions.

Iran, nevertheless, tried to compensate by pledging hundreds of millions of dollars in goods and services to Turkmenistan, the statement further said.

Turkmenistan says it tried to resolve the debt issue with Iran in the past year, but has not received any response.

On December 31 Iranian sources said that following negotiations, the two sides reached a deal to extend the 20-year deal for another five years. However, the following day Turkmenistan halted the gas flow, which keeps houses warm in a few northern Iranian provinces.

A gas pipeline was built between Turkmenistan and Iran in 1997. Another route was completed in 2010, bringing Turkmenistan's annual gas export capacity to Iran to 12 billion cubic meters.