Norway seizes Russian state-owned ship 'Professor Molchanov' in Svalbard

Norwegian officials seized the Russian state-owned ship named "Professor Molchanov" on Wednesday at the port of Barentsburg in the Arctic archipelago of Svalbard.

The authorities acted on an application from Ukraine's state energy company, Naftogaz, which is pursuing compensation for energy assets Russia expropriated when it illegally annexed Crimea in 2014.

The seizure followed an order from the Norwegian Nord-Troms and Senja District Court issued on Monday.

Svalbard's governor, Lars Fause, whose office carried out the operation as the local enforcement authority, said the vessel may not leave its current location. Passengers who were aboard are being dealt with separately by Norwegian authorities.

At the time of writing, the Kremlin has not made a statement regarding the situation.

A $4.2 billion bill that Moscow will not settle

An arbitration tribunal at the Permanent Court of Arbitration in The Hague ruled in 2023 that Russia must compensate Naftogaz and six associated companies for unlawfully seizing their Crimean assets, including gas fields, pipelines and the Black Sea producer Chornomornaftogaz.

The outstanding principal stands at roughly $4.22 billion (€3.64bn), before interest and costs which could drive the amount to around $5 billion (€4.31bn).

Russia has declined to pay.

Naftogaz has therefore been petitioning courts in countries where Russian commercial property can be found, and the award had already been recognised as enforceable in Norway before this week's order.

"Russia cannot evade responsibility simply by refusing to comply with an international arbitral award," said Naftogaz' acting CEO Sergii Fedorenko, calling the seizure "another important step towards restoring justice."

Fedorenko added that the company would "continue to pursue Russian assets around the world" until the money is paid.

In Norway, Naftogaz is represented by the law firm Wikborg Rein, alongside international counsel Covington & Burling.

Part of a widening hunt

The Arctic operation is not an isolated one.

Enforcement proceedings in the Crimea case are active in around ten jurisdictions, with Russian assets already seized in Finland and France.

Barentsburg is a Russian coal-mining settlement sitting on Norwegian territory, a legacy of the 1920 Svalbard Treaty, which confirmed Norwegian sovereignty over the archipelago while granting signatory states, Russia among them, equal rights to commercial activity there.

The "Professor Molchanov", owned by the Russian Federation, runs commercial expedition cruises including voyages to Svalbard itself.