Venture Global responds to Shell's fraudulent claims in LNG arbitration
Venture Global responded late Tuesday night to Shell's legal challenge over its loss in an arbitration case involving liquefied gas cargoes. The company rejected allegations of fraud, and accused Shell of breaching arbitration confidentiality.
The legal documents filed in New York Supreme Court are the latest in a long-running saga about Venture Global's inability to deliver LNG in accordance with long-term contracts, while selling LNG on the spot market when prices rose after Russia's invasion in Ukraine. Shell, BP, Edison and other companies filed arbitration claims in 2023 against Venture Global. Shell lost in August while BP won in October. Sources have reported that Unipec has settled its case. Shell challenged the arbitration decision last month, claiming that a third-party testified in arbitration that Venture Global abruptly delayed the start of the Calcasieu Pass Liquefied Natural Gas plant. Shell claimed it had asked arbitrators for a study of 'that communication', but Venture Global avoided disclosure through misleading statements. Venture Global stated in its filing of Tuesday that Shell did not provide any evidence to support the fraud allegations. The company said that the third party (whose name was redacted) "didn't testify about written communications with Venture Global", and that Venture Global counsel didn't?make misleading claims. In the filing, Shell also claimed that it had violated arbitration confidentiality by sharing information with Venture Global counterparties and their lawyers.
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Shell's arbitration case centered around cargoes coming from Venture Global Calcasieu Pass. Shell has also signed a long-term agreement with Venture Global Plaquemines.
Venture Global's legal filing included an email, which it claimed was from a Shell executive whose name had been redacted. The email indicated an interest in a commercial solution. In an email sent the day after the oil giant filed its complaint, the Shell executive said: "We are still interested in?finding a resolution commercial for both the CP(Calcasieu pass) and Plaquemines cases and I would welcome a discussion at your earliest opportunity." In the email, the Shell executive told Venture Global that the outcome of the arbitration between the LNG producers and BP 'raised serious concerns regarding the evidence presented during that proceeding. He suggested that Shell arbitration should have been determined in the same manner. Venture Global's shares have also been under pressure due to its exposure to a potential LNG glut. They are down 22% since Shell filed the challenge in late last month. The shares are now hovering around an all-time high of $6.56 compared to $24 when the company first began trading in January.
BP's?arbitration win was won by Venture Global based on the argument that Venture Global acted unfairly, citing 5 sources.
Legal experts said that Shell's challenge was based on BP winning the arbitration in October.
Claudio Steuer, Oxford Institute for Energy Studies said that Shell's reference to BP's victory (in its challenge), signals that similar fact patterns led to different tribunal results. This strengthens Shell's case that full access to evidence is important. (Reporting and editing by Nia Williams, Stephen Coates and Curtis Williams. Marwa Rashad provided the reporting; Curtis Williams edited it.)
(source: Reuters)
