SOCAR achieves injunction on supply of diesel fuel to Ukrainian Railways

  23 May 2018    Read: 1017
SOCAR achieves injunction on supply of diesel fuel to Ukrainian Railways

The Kiev District Administrative Court has granted the application of SOCAR Energy Ukraine (the Ukrainian subsidiary of Azerbaijan's state oil company SOCAR) to secure the claim by prohibiting the Production Supplement Centre of the JSC Ukrzaliznytsia (Ukrainian Railways) to take any action to sign a deal for supply of 10,000 tons of diesel fuel at 2,820 hryvnia ($108.13 ) per ton, enkorr website reported referring to the court decision dated May 16.

Reportedly, during the April 2 auction on one of the tenders of Ukrzaliznytsia for supply of 10,000 tons of diesel fuel, SOCAR Ukraine mistakenly offered 28.2 million hryvnia (more than $1.08 million) instead of the estimated 282 million hryvnia (more than $10.81 million).

The ProZorro system automatically determined SOCAR as the winner, and Ukrzaliznytsia sent documents to the company to sign the contract.

"In case of SOCAR's unilateral refusal to ink the deal, according to the tender rules, the company's bid guarantee fee in the amount of 8.8 million hryvnia should be transferred to Ukrzaliznytsia," according to the message.

SOCAR claimed that a technical error occurred due to an excessive power surge in the network in the interval between 11:15 (GMT + 3) and 11:40 (GMT + 3) within the third stage of the reduction, when the price of the offer was being filled. This led to the automatic shutdown of electronic means, after which connection with the trading platform was lost and as a result price of the tender offer was fixed in the amount of 28.2 million hryvnia, which is mistake and 10 times lower than the initially announced price - UAH 295.46 million.

"The company filed a suit, and also filed an application for its provision by prohibiting Ukrzaliznytsia to take any action to sign the contract during the trial period. On May 2, the court considered SOCAR's arguments unconvincing and refused to secure the company's claim, " according to the message.

On April 2, Ukrzaliznytsia determined winners for six tenders for the supply of 60,000 tons of diesel fuel at the auction in the system ProZorro. On April 20, agreements were signed following announcement of results of five tenders. The results of the sixth tender have not yet been announced.

At the sixth tender, SOCAR mistakenly offered a price of UAH 2,820 per ton instead of UAH 28,200 per ton and was automatically determined as the winner. SOCAR tried to appeal the result at the Antimonopoly Committee, but it did not consider the company's appeal.

The representative office of SOCAR was opened in Ukraine in 2008. In 2009, the company purchased about 20 filling stations of the Tala-Nafta network in Odessa and Nikolaev regions, as well as a large oil depot Svitanok in the Odessa region.

In 2010-2011, the company took control of the fuelling networks ONIO (four filling stations in Kiev and the region) and GFC (in Lviv region). In August 2012, SOCAR received permission from the Antimonopoly Committee of Ukraine to purchase 26 filling stations and one tank farm of the Kalina group.

The network operates 60 petrol stations in Ukraine, as well as two “Baku-1” oil bunkers in Kiev and “Ganja” in Odessa. Since late 2016, the company has also been engaged in trade of natural gas in Ukraine.

(26,08 UAH = 1 USD on May 22)


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