BP chief expects ruling on Venture Global dispute later this year

Auchinclosss was asked during BP’e 2024 earnings call on Wednesday about how much volumes BP expects to receive from Venture Global’s Calcasieu Pass LNG plant in Lousiana this year.

“Venture, I’m just going to not comment as the arbitration continues, let’s see how that arbitration goes,” he said.

“Hopefully, we see a ruling in the back half of the year on that and then we start to see flow,” Auchinclosss said.

The CEO did not provide further information.

BP has a 20-year LNG contract for volumes for the Calcasieu Pass LNG terminal in Louisiana, the same as Shell.

The two firms and other Calcasieu Pass customers are in a dispute with Venture Global over the launch of commercial operations at the facility and they previously launched arbitration proceedings against Venture Global.

Besides Shell and BP, customers of the Calcasieu pass facility include Repsol, Edison, Galp, PGNiG, now part of Orlen, Sinopec’s unit Unipec, and CNOOC.

Calcasieu Pass produced its first LNG on January 19, 2022, moving from FID to LNG production in 29 months, and the first commissioning cargo left the facility on March 1, 2022.

However, Venture Global has not yet declared commercial operations at the facility.

In February last year, Venture Global asked FERC to extend the in-service deadline for the facility for one additional year, or by February 21, 2025.

The 10 mtpa Calcasieu Pass facility consists of 18 modular units configured in 9 blocks.

A recent report by FERC recently showed that Venture Global expects to complete repairs on the final heat recovery steam generator at its Calcasieu Pass terminal by the end of February.

Venture Global said in its IPO statement in December 2024 that it is targeting a COD (commercial operations date) for Calcasieu Pass at the end of March 2025.

The company said in the document that the facility had loaded and sold 342 LNG commissioning cargoes as of September 30, 2024.

According to Venture Global, the company received about $19.6 billion in gross proceeds from such commissioning cargoes.

Billions sought in arbitrations

The document also shows that pending arbitration claims against Venture Global regarding the Calcasieu Pass volumes have reached more than $5.5 billion.

In December 2022, a long-term customer of the Calcasieu project submitted a request for arbitration to the International Chamber of Commerce, International Court of Arbitration, in accordance with the dispute resolution procedures of the post-COD SPA, asserting that Venture Global had failed to provide sufficient information or access to the Calcasieu project, the document shows.

The remedies sought by the long-term customer are contract damages in excess of $1 billion, which is potentially subject to increase with the passage of time until COD occurs, rather than the termination of the post-COD SPA.

Ventrue Global said in the document the initial merits hearing for this arbitration proceeding occurred in September 2024.

In May 2023, two additional long-term customers submitted separate requests for arbitration to the London Court of International Arbitration and the International Chamber of Commerce, International Court of Arbitration, respectively.

The remedies sought by such long-term customers included contract damages of about $1.5 billion and $1.7 billion, respectively.

Venture Global said the hearings for such two arbitration proceedings occurred in October 2024 and November 2024, respectively.

In August 2023, two additional long-term customers of the Calcasieu project submitted separate requests for arbitration to the International Chamber of Commerce, International Court of Arbitration.

The hearings for such two arbitration proceedings will take place in June 2025 and July 2025, respectively.

Also, one additional long-term customer of the Calcasieu project submitted a request for arbitration to the International Chamber of Commerce, International Court of Arbitration in December 2023.

The remedies sought by each of the second group of three long-term customers include contract damages in an amount to be determined in excess of $250 million (in the case of one such customer) or $400 million (in the case of two such customers), rather than the termination of the relevant post-COD SPAs, Venture Global said.

Further, in March 2024, a short-term customer of the Calcasieu project submitted a request for arbitration to the International Chamber of Commerce, International Court of Arbitration.

“Such customer has raised substantially the same assertions as the arbitration proceedings described above and is seeking contract damages of $200 million (which is potentially subject to increase with the passage of time until COD occurs), as well as an additional claim relating to an undelivered commissioning cargo,” Venture Global said.