Venture Global’s shares surged nearly 8% on Thursday after an arbitration tribunal ruled in favor of the U.S. liquefied natural gas supplier in a dispute with Spain’s Repsol.
Repsol brought the case in 2023 over Venture Global’s initial failure to deliver LNG from its Calcasieu Pass project under a 20-year long-term contract.
The Paris-headquartered International Chamber of Commerce denied Repsol’s claims in their entirety and found that the U.S. company had acted as a “reasonable and prudent operator” in accordance with the agreement.
Venture Global, the second-largest LNG exporter in the U.S., has won two of three decisions released on arbitrations brought against it in 2023.
The company received a positive tribunal decision in a similar arbitration against Shell in August last year. However, in October, the tribunal ruled against Venture Global in proceedings against BP.
Other companies, including Italy’s Edison and Portugal’s Galp, have also filed claims against Venture Global that are still pending.
The companies have accused Venture Global of profiting from selling LNG on the spot market – when prices surged after Russia’s invasion of Ukraine – instead of delivering them the cargoes they had signed for years in advance.
Venture Global said it had fully honored the terms of its long-term contracts and was confident it would win the remaining cases.
UBS analyst Manav Gupta told Reuters additional arbitration results related to proceedings with Edison, Galp and Orlen were expected to be released in 2026 and 2027.
Venture Global’s market capitalization has fallen from roughly $58 billion in January last year, when it went public, to about $22.16 billion as of Wednesday’s close.
The stock remains depressed due to the arbitration overhang, UBS analysts said, adding that the win against Repsol should be a big relief for investors.
(Reporting by Vallari Srivastava and Pranav Mathur in Bengaluru)
