The LNG industry is experiencing some unique opportunities and challenges driven by the surge in LNG liquefaction supply in recent years and currently flat LNG demand profiles in significant markets, coupled with potential anti-trust regulatory intervention and increasing collaboration among powerful buyers in the procurement of LNG.
An expert panel will consider the changing nature of the LNG market, review the attributes and potential ramifications of the current Japan Fair Trade Commission investigation into destination flexibility, and explore contract term flexibility and price review issues.
Panel speakers include:
- Robert Oushoorn, Partner, Bain & Company: "Dealing with the Changing Nature of the LNG Market"
- Paul Lugard, Partner, Baker Botts, Brussels: "Destination (in)Flexibility: The Antitrust Dimension"
- Jay Alexander, Partner, Baker Botts, London: "The Disputes that Changing Times are Bringing"
“Our LNG Forum is particularly well-regarded as an open platform for like-minded industry professionals to review and discuss the latest LNG trends and issues with their peers. This time, we are reviewing destination flexibility, term and pricing issues in the context of a rapidly changing market, so this will be a highly informative and engaging gathering,” said Mark Rowley, Partner in Charge of Baker Botts London office.
“The Japan Fair Trade Commission has called for the relaxation or abolition of resale restrictions in trade contracts with LNG exporters. These so-called “destination clauses” are deemed inflexible, as restricting the resale of LNG cargos impedes free competition. It remains to be seen how the investigation will develop, but in the long-term LNG sellers may have to become more flexible regarding their contracts before reaching a final investment decision,” commented Paul Lugard, a partner in Baker Botts Antitrust Practice, based in Brussels.
“There is substantial evolution in both the supply and demand side of the LNG market. In addition to significant increases in liquefaction capacity in both the Atlantic and Pacific Basins, we are seeing new uses and outlets for LNG from short-term trading to FSRUs to transport to continuing substitution of alternative fuels. This evolution is driving changes in commercial activities, all of which have financial consequences. Given the values at stake in the LNG industry, those consequences are leading to strategic behaviour by buyers and sellers that often ends in disagreement and renegotiation or arbitration,” added Jay Alexander, a London-based senior trial partner and co-chair of Baker Botts’ global international arbitration practice.
“There are a number of fundamental issues potentially impacting the LNG market at present. How these issues are resolved now, will likely have a significant impact on the look and shape of the industry for years to come,” said John White, a partner in Baker Botts’ LNG practice, currently based in Moscow.
Baker Botts’ LNG Practice has a wealth of global experience in LNG related projects, transactions and disputes. Our integrated team of 50+ LNG lawyers are highly attuned to changing market conditions and efficiently able to manage the complex transactions inherent in major LNG projects.
Mark Rowley, Paul Lugard, Jay Alexander and John White are available to discuss the legal and commercial implications of the changing LNG market, including destination flexibility, contract term and pricing issues.
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