By KYIV. Nov 30 (Interfax-Ukraine) – The National on Corruption Prevention Agency of Ukraine (NACP) has added the Belgian independent gas system operator Fluxys to the list of international sponsor of war.
According to the NACP press service, the decision was made on the basis of the company’s behavior not being in compliance with the UN Guiding Principles on Business on Human Rights and the continued promotion of the export of climate-damaging Russian liquefied natural gas (LNG), which ensures financial resources for the Russian invasion of Ukraine.
“Despite the ongoing full-scale Russian invasion, Belgian independent gas infrastructure operator Fluxys continues to provide Novatek subsidiary Yamal LNG with LNG storage and transshipment services at its Zeebrugge terminal. These services enable the export of Russian additional revenues to Novatek and tax revenues for the Kremlin regime, which is committing countless war crimes in Ukraine. Thanks to the facts provided by Ukrainian and Belgian public organizations, we found sufficient grounds to include Fluxys in the list of international sponsors of war,” Head of the sanctions department at NACP Agia Zagrebelska said.
Belgian operator Fluxys provides liquefied gas storage and transshipment capacity to Yamal LNG, a joint venture majority owned by the Russian gas company Novatek, which is directly involved in financing military aggression and war crimes in Ukraine. A detailed analysis by the Institute for Energy Economics and Financial Analysis (IEEFA) in 2022 found that Fluxys and its shareholders were profiting by facilitating Russian LNG exports to markets in Asia, South America and the Middle East, particularly during the winter months of 2021/2022, which exacerbated the European energy crisis and increased profits for Novatek.
“The reputational risks associated with being listed as a war sponsor and a potential credit rating downgrade are not unique to Fluxys. By continuing its involvement in Russian LNG operations, Fluxys may face the risk of being subject to secondary U.S. sanctions, especially given that Novatek, as reported, directly contributes to Russia’s war of conquest, as investigations show that the company’s security guards were used to create special military units that participated in the fighting in Ukraine,” founder and director of Razom We Stand Svitlana Romanko said.
In response to the unprovoked and unlawful war of aggression, many companies ceased all business interactions with Russian partners after February 24, 2022. However, Fluxys continued to cooperate with Yamal LNG and Novatek throughout 2022 and into 2023. According to experts, Russia expects to receive up to EUR 800 million in export tax revenues, which is possible thanks to LNG transshipment in Zeebrugge in 2023. Only 7% of this gas goes to EU markets. Fluxys receives EUR 50 million a year for this service under a long-term contract signed in 2015, a year after Russia annexed Crimea and began the war in Donbas.
Novatek, owned by Russian oligarchs Leonid Mikhelson and Gennady Timchenko, is the main supplier of Russian liquefied natural gas to international markets. Mikhelson and Timchenko are members of the inner circle of Russian President Vladimir Putin and, with the help of his regime, seized shares of international companies in Russian oil and gas projects. Novatek is the largest private producer of natural gas in Russia. In July 2014, Novatek was included in the sanctions lists of the United States and Canada. In 2016, the United States imposed sanctions against several Novatek subsidiaries. On November 2, 2023, the United States imposed sanctions against the Arctic LNG 2 project, the goal of which was to double Novatek’s export capacity.
In October, Razom We Stand, on behalf of 23 Ukrainian NGOs, sent an open letter to the Belgian federal government calling on it to take the initiative to introduce a complete ban on the transshipment of Russian LNG in all EU harbors, including the Fluxys LNG terminal in Zeebrugge. The Netherlands and the UK have already introduced such bans.
The main shareholders of Fluxys are the Belgian municipalities (77.41%) and the Belgian federal government (3.44%). Both sides pledged to keep global temperature rise below 1.5℃ by supporting the Global Covenant of Mayors and the Paris Agreement respectively. They also say they have high respect for international humanitarian law, which prohibits deliberate attacks on civilians or critical civilian infrastructure. These obligations contradict the actual continuation of cooperation with the Russian company Novatek.
