[3] In January 2023, Kobolyev was indicted for allegedly "paying himself" more than the statutory maximum allowed a state-owned enterprise employee in the form of a bonus he was awarded by the independent Naftogaz Supervisory Board, pursuant to a Ukrainian government-approved contract, for winning US $4.63 billion from Russia's PJSC Gazprom in the Stockholm Arbitration cases.
The charges against Kobolyev were viewed by (his) former colleagues and anti-corruption activists as part of a Ukrainian government effort to eliminate prominent reformers and punish potential political rivals.
[9] A few months later, in summer 2014, Gazprom cut off natural gas supplies to Ukraine, citing billions of dollars in unpaid bills as the justification.
[10] The situation was further complicated by domestic companies refusing to pay their debts, and by Russia seeking to prevent Ukraine importing gas from elsewhere in Europe.
By 2021, when he was removed as head of Naftogaz, he had successfully overseen the transformation of the company from a Soviet era loss making relic into contributing as much as 20% of Ukraine's annual national budget.
[13] Kobolyev believed Ukraine has the potential to become self-sufficient in natural gas given its sizable reserves if a collaborative plan between the company, government, and private sector is devised.
[14] Kobolyev sought to loosen the grip of business and political leaders on Naftogaz, also a key foreign policy for western governments because of the traditionally outsized presence of corruption in Ukraine's energy sector.
[6] Then, in 2015, Naftogaz cut off gas to two Firtash-controlled (Dmytro Firtash is a Ukrainian billionaire and oligarch under indictment and fighting extradition by the U.S. for corruption) chemical factories until they agreed to pay debts of $120 million.
[15] Kobolyev also tried to minimize the corrupt role in Ukraine's energy sector of oligarch Ihor Kolomoiskyi, a grizzled media, and banking tycoon.
[21] The corporatization and resulting independence of state-owned Naftogaz was an ongoing point of contention with the Ukrainian government, which proved reluctant to give up direct control over company decisionmaking.
[22] When Kobolyev was fired in March 2021 and Zelensky's government seized direct control of the company, the Naftogaz Supervisory Board resigned in protest.
[24] On February 22, 2022, Germany stopped the Nord Stream 2 gas pipeline certification in reaction to Russia's recognition of the self-proclaimed republics in Luhansk and Donetsk in east Ukraine, the chancellor, Olaf Scholz, announced.
[27] As a result, Naftogaz team won and successfully collected $4.63 billion from Gazprom, which was paid into Ukrainian state coffers at the end of 2019.
In 2020, Zelensky authorized Kobolyev receiving the bonus pursuant to the contract, and the Ukrainian government paid him accordingly as a reward for winning the Stockholm Arbitration.
[4] The charges against Kobolyev are widely viewed as part of a Ukrainian government effort to eliminate reformers and punish potential political rivals.
[29] The successful unbundling of the GTS operator made it possible to sign a new gas transit deal at the end of 2019 with Gazprom on beneficial terms for Ukraine.
This allowed for natural gas retail supply market liberalization to finally take place, long a priority of western governments seeking to help reform Ukraine.
[30] Although required by the EU Association Agreement and a commitment to reform-minded western partners, the reforms made Kobolyev the target of negative press because gas prices nominally increased above their previously government-set rate.
[31] Naftogaz became a national natural gas supplier to households, expanding its presence into all Ukrainian regions through an effective online and offline partnership model.
[34] The supervisory board, which the Cabinet of Ministers of Ukraine temporarily suspended in order to seize the control necessary to dismiss Kobolyev, resigned en masse in response effective May 14, 2021.