Executive Summary

This article discusses the impact of recent developments in the global LNG trade on the key terms in long-term LNG supply contracts (LNG SPAs) in different regions, particularly in Asia. After outlining the most salient clauses of LNG SPAs, the authors provide an analysis of several ways by which parties to such contracts anticipate and confront some of the risks associated with the sale and purchase of LNG, based on the price review clause mechanisms and the concepts of force majeure, change of circumstances (and hardship). The article then analyses these mechanisms and concludes with (or: offers) certain practical considerations for negotiators of such contracts from the perspective of the authors’ disputes resolution practice. Finally, it highlights some topical issues with respect to the force majeure declarations in China following the COVID-19 crisis.

This paper will be part of the OGEL Special Issue on "Changing LNG Markets and Contracts". More information here www.ogel.org/news.asp?key=617