Venture Global has won its second arbitration case in an LNG export dispute with half a dozen European energy companies. That case specifically was brought against the U.S. LNG producer by Spain’s Repsol.
Shell, BP, Repsol, and other major oil and gas firms accused Venture Global in 2023 of profiteering by selling on the higher-price spot market LNG cargoes that should have been supplied under their long-term contracts. The U.S. firm used a loophole to do that by extending the deadline for officially commissioning the Calcasieu Pass export project.
In August, Shell lost the arbitration against Venture Global as the tribunal ruled that the U.S. company had not violated its contractual obligations with its long-term clients. Two months later, however, the court ruled in favor of another plaintiff, BP.
Venture Global claimed that it was under no obligation to honor its long-term commitments until the plant was officially commissioned, which happened earlier this year. Meanwhile, it managed to build a second LNG facility that produced its first LNG at the end of 2024—before the first one was officially commissioned.
The saga sparked concern among investors with stakes in Venture Global’s second LNG project, Plaquemines. The fact that Venture Global asked the Federal Energy Regulatory Commission to delay the official commissioning of Plaquemines did not help client trust. This in turn prompted the company to write to them in October last year and assure them it had no plans to start selling liquefied gas on the spot market before the facility was commissioned. The companies suing the U.S. LNG producer now are investors in its first LNG facility, Calcasieu Pass.
In 2022, Venture Global made billions on the spot market amid the gas crunch in Europe that began in late 2021 and grew severe after the Russian invasion of Ukraine and the sanctions that the EU responded to the events with.
By Irina Slav for Oilprice.com
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