Venture Global wins arbitration case against Shell in LNG contract dispute

[Digitally Generated Image of LNG Tanker Navigating Coastal Waters Representing Maritime Energy Transport]
alvarez/E+ via Getty Images

Venture Global (NYSE:VG [https://seekingalpha.com/symbol/VG]) +4.9% post-market Tuesday after it said an arbitration tribunal ruled in its favor [https://seekingalpha.com/pr/20198745-venture-global-statement-on-shell-arbitration-decision] in its legal battle against Shell (NYSE:SHEL [https://seekingalpha.com/symbol/SHEL]) in a dispute over its failure to deliver liquefied natural gas under long-term contracts starting in 2023.

Several companies, including Shell, BP (BP [https://seekingalpha.com/symbol/BP]) and Repsol (OTCQX:REPYF [https://seekingalpha.com/symbol/REPYF]) (OTCQX:REPYY [https://seekingalpha.com/symbol/REPYY]) filed arbitration claims accusing Venture Global (NYSE:VG [https://seekingalpha.com/symbol/VG]) 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.

"We are pleased with the tribunal's determination which reaffirms what Venture Global has maintained from the outset - the plain language in our contracts, mutually agreed upon with all of our customers, is clear," the company said.

Shell (NYSE:SHEL [https://seekingalpha.com/symbol/SHEL]) said it was disappointed with the tribunal's decision, as "trust in long-term contracts is the bedrock of the LNG industry and essential for continued investment and sustainable growth."

Earlier on Tuesday, Venture Global (VG [https://seekingalpha.com/symbol/VG]) said in its Q2 earnings [https://seekingalpha.com/news/4483975-venture-global-rallies-after-posting-higher-q2-profit-as-revenues-nearly-triple] report that it estimated a penalty of as much as $1.6B if it lost the arbitration cases.

MORE ON VENTURE GLOBAL

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* Venture Global: Bad Stock Performance No Indicator Of Good Operational Outlook [https://seekingalpha.com/article/4786499-venture-global-bad-stock-performance-no-indicator-of-good-operational-outlook]
* Venture Global: Failing To Meet Expectations To Date [https://seekingalpha.com/article/4776995-venture-global-failing-to-meet-expectations-to-date]