Venture Global stock sinks after arbitration loss to BP over LNG dispute

[LNG (Liquified Natural Gas) tanker anchored in Gas terminal gas tanks for storage. Oil Crude Gas Tanker Ship. LPG at Tanker Bay Petroleum Chemical or Methane freighter export import transportation]
Suphanat Khumsap

Shares of Venture Global (NYSE:VG [https://seekingalpha.com/symbol/VG]) tanked in post-trading on Thursday as the company potentially faces multibillion-dollar damages over disputed LNG shipments after a loss in a landmark BP (NYSE:BP [https://seekingalpha.com/symbol/BP]) arbitration proceeding concerning the Calcasieu Pass facility.

The International Court of Arbitration told Venture Global Calcasieu Pass on October 8 that it had issued a partial final award in its arbitration case with BP Gas Marketing over LNG sales from the Calcasieu Project, according to a filing [https://seekingalpha.com/filing/10512574].

"Among other remedies, BP is seeking damages in excess of $1.0 billion, as well as interest, costs, and attorneys’ fees," the filing said.

The award issued by the arbitration tribunal found that VGCP had breached its obligations to declare COD of the Calcasieu Project on time and act as a “Reasonable and Prudent Operator” pursuant to the SPA, along with certain other obligations.

Remedies will be determined in a separate damages hearing, which has not been scheduled but is anticipated to occur in 2026.

Venture Global (NYSE:VG [https://seekingalpha.com/symbol/VG]) said a final award is expected to follow the damages portion of the hearing, and the company is currently evaluating all available options in response to the tribunal’s ruling and will continue to "vigorously defend" its position.

“The market is pricing in broader risk of further adverse rulings,” the Schneider Capital Group said in a research note, adding that unresolved claims could top $5 billion, _Bloomberg News _reported.

The US LNG exporter’s shares plunged as much as 15% after market close on Thursday after the announcement.

Earlier this year, Venture Global (VG [https://seekingalpha.com/symbol/VG]) said an arbitration tribunal ruled in its favor [https://seekingalpha.com/pr/20198745-venture-global-statement-on-shell-arbitration-decision#hasComeFromMpArticle=false#source=section%3Amain_content%7Cbutton%3Abody_link%7Cfirst_level_url%3Anews] in its legal battle against Shell (SHEL [https://seekingalpha.com/symbol/SHEL]) in a dispute over its failure to deliver liquefied natural gas under long-term contracts starting in 2023.

MORE ON VENTURE GLOBAL, BP P.L.C.

* Can Kosmos Energy Help BP? [https://seekingalpha.com/article/4828821-can-kosmos-energy-help-bp]
* Inside Venture Global's LNG Strategy [https://seekingalpha.com/article/4827382-inside-venture-global-lng-strategy]
* BP P.l.c. (BP) Discusses Launch Of Energy Outlook 2025 Call (Transcript) [https://seekingalpha.com/article/4825880-bp-plc-bp-discusses-launch-of-energy-outlook-2025-call-transcript]
* BP launches North Sea oil project as part of fossil fuel push [https://seekingalpha.com/news/4503004-bp-launches-north-sea-oil-project-as-part-of-fossil-fuel-push]
* Clariant rejects €2B damage claims by BP, Exxon [https://seekingalpha.com/news/4501735-clariant-rejects-2b-damage-claims-by-bp-exxon]