25 Oct 2019 09:44

Novatek using mainly euros in settlements with counterparties

VERONA. Oct 25 (Interfax) - Novatek is primarily using euros in settlements with counterparties, the Russian gas producer's CEO, Leonid Mikhelson told reporters.

He recalled that Novatek was hit by U.S. sanctions in 2014 that barred U.S. persons from participating in financing for the company with duration of more than 90 days. "So for us this process began earlier than for Rosneft [which announced on Thursday that it has switched all its contracts to euros]. And, of course, we mainly use euros in settlements with counterparties," Mikhelson said.

"We are trying [to move] all [sold products to euros]. We are constantly running into delays with payments," he said, remarking that compliance at counterparties considers contracts for possible sanctions exposure.

"A payment is underway, it's stopped at some bank for two weeks and they say 'compliance.' At the bank they probably expressly ask, 'let's write up some obscure sanctions,' and they just get additional free working money. It's just outrageous," Mikhelson said.