KIEV, February 21 - RAPSI, Alyona Meita. Ukrainian oil and gas operator Naftogaz has lost a $3.9 billion lawsuit against Italian gas trader, newspaper Kommersant Ukraina writes on Thursday, citing the decision of the Arbitration Institute of the Stockholm Chamber of Commerce.

The court ruled that Naftogaz must honor its 2003 contract with Italia Ukraina Gas to supply it with 13.1 billion cubic meters (bcm) of natural gas at $110 per 1,000 cu m, even though the current price is $416. The Ukrainian company will lose $3.9 billion by this decision.

Moreover, the court has also ordered Naftogaz to pay $12.7 million in fines to Italia Ukraina Gas for delaying its gas supplies.

Naftogaz was contracted to deliver 1.3 bcm of natural gas annually from January 1, 2004 to December 31, 2013 to Velke Kapusany, on the border with Slovakia. At that time, it bought gas from Turkmenistan at $50 per 1,000 cu m and so expected to earn about $780 million a year from its contract with the Italian trader.

According to the court documents, Naftogaz did not supply any gas to Italia Ukraina Gas in 2004-2005, allegedly because the Italian trader did not have a contract with the Slovak gas transportation company SPP. It only signed the contract in 2006, by which time Russia's Gazprom had contracted the entire volume of Turkmen gas, leaving Ukraine empty-handed. Swiss-registered gas transportation company RosUkrEnergo, which became the sole importer of gas into Ukraine, sold it through UkrGazEnergo. As a result, it became impossible to go through with the agreement made with the Italian trader.