HOUSTON — Venture Global has won a legal battle against Shell over its failure to deliver liquefied natural gas under long-term contracts starting in 2023, the US. LNG major said on Tuesday.
The company’s stock price rose almost 6 percent in after hour trade as investors cheered the decision.
Firms, including Shell, BP, Edison and Galp, filed arbitration claims starting in 2023, accusing Venture Global of profiting from the sale of LNG on the spot market while not providing them with their contracted cargoes from the Calcasieu Pass export facility in Louisiana.
The companies accused Venture Global of profiteering by selling commissioning cargoes at higher spot market prices, rather than at long term contracted prices.
Venture Global denied the claim, saying it delayed moving to commercial operations because of a faulty electric system that did not allow the plant to operate optimally.
“We are disappointed with the outcome but respect the Tribunal’s decision,” Shell said in a statement to Reuters.
Trust in long-term contracts is the bedrock of the LNG industry and essential for continued investment and sustainable growth, the company statement said.
The decision of the tribunal is in keeping with Venture Global’s position that it has always honored its agreements with its customers, the company said.
“Our industry and the investors and lenders who underpin it, all rely on respect for both the sanctity of negotiated contracts and the experienced, objective regulatory and legal bodies that govern it,” Venture Global said.
