Naftogaz emerges as key backup provider amid continuing gas market volatility during war

The Cabinet of Ministers appointed LLC Gas Supply Company Naftogaz of Ukraine as the backup gas supplier without a competitive bidding process, according to the government's representative in the Verkhovna Rada, Taras Melnychuk.

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The company will have to perform these functions until the end of martial law and for six months after its termination or repeal.

According to the natural gas market law, the supplier of last resort is designated by the Cabinet of Ministers for three years based on a competitive selection process.

GSC Naftogaz was designated as the supplier of last resort by Cabinet Order No. 917 of July 22, 2020. During three years, the company, performing this function, supplied gas to more than 9 million households and almost 8,000 non-domestic consumers (enterprises, district heating, etc.).

In July 2023, the company announced that this order had expired.

REFERENCE. The supplier of last resort is a company that is obliged to supply gas to the consumer within 60 days if they remain without a gas supplier. The company must have a certain gas reserve that corresponds to the maximum monthly consumption during the heating season.

In 2022, GSC Naftogaz of Ukraine saw the number of residential customers receiving gas supplies from the company surge nearly 100%.