Iran pays arbitration debt in full to Turkey

Iran paid full compensation of $1.9 billion to Turkey through the provision of 8 billion cubic meters of free natural gas, the Managing Director of National Iranian Gas Company (NIGC) Hamid Reza Araghi announced late Monday.

According to Iran's Fars News Agency, Araghi said that Iran has now settled its debt through free gas exports to Turkey and from Monday, Feb. 5 onwards, Iran will revert to billing Turkey for gas imports from Iran.

In 2012, Turkey brought Iran to the International Court of Arbitration for overpricing on gas purchases during the four-year period from 2011 to 2015.

The court ruled in favor of Turkey in February 2016 and ordered that both parties agree on a reduction between the rates of 10 percent and 15 percent in the price of Iranian gas exports to Turkey. In addition, Iran had to pay $1.9 billion in compensation to Turkey in line with the decision of the International Court of Arbitration

Turkey already buys around 10 billion cubic meters of gas from Iran per year.

Iran became Turkey's second-largest gas supplier after Russia after it began exporting gas to Turkey in 2001.