After winning its contract dispute with Shell, Venture Global (VG) is expecting any remaining arbitration battles to go the same way.
Venture Global CEO Mike Sabel told investors that all companies involved in the battle signed essentially the same contract, and Venture Global therefore expects the same outcome.
“(We) remain confident of similar outcomes in the balance because it’s the same contract, and the facts around construction and the facts around the completion of the facility are all the same,” Sabel said.
The CEO spoke during the company’s second-quarter earnings call on Aug. 13, the day after it became public that the New York arbitration court ruled in their favor against the oil giant.
Venture Global has been in an arbitration dispute with several major customers since the end of 2024. The fight stems from VG’s decision to continue classifying its Calcasieu Pass LNG terminal as commissioning, even though production started in 2022.
As a commissioning facility, Calcasieu Pass cargoes were sold for a higher price on the spot market, especially after the Russian invasion of Ukraine caused natural gas prices to spike. The move had irked customers who had signed long-term sales and purchase agreements that served as the primary commercial backing for the project.
A Shell spokeswoman said the company was disappointed in the decision and that it may hurt future investment in LNG development if customers no longer trust how contracts will be fulfilled, the Wall Street Journal reported.
The remaining companies in arbitration include some of the major players in the industry, such as BP, Edison and Portugal’s Galp Energia. The complainants are seeking around $1.7 billion each in damages.
“This was an unnecessary distraction because this contract language has always been clear and standard and straightforward and required as part of the project financing,” Sabel said.
Plaquemines ramp continues
Venture Global recorded another win for the week, receiving permission from the Federal Energy Regulatory Commission (FERC) to begin production on Train 16 at Plaquemines LNG.
On Aug. 12, the FERC sent a note approving the introduction of hazardous fluids to the liquefaction block. The permit is generally the final one sent to an LNG facility before production begins.
Plaquemines started production in December 2024. The plant has a total of 18 liquefaction trains planned for its Phase 1 development. Train 16 will bring 15 of the trains online, after Train 15 was delayed. Once completed, Phase 1 will have a peak capacity of 1.6 Bcf/d of natural gas.
For the quarter, Venture Global hit $3.1 billion in revenue, beating the street consensus of $2.9 billion. Net income of $368 million missed by 39%. The company reported that lower LNG prices at Calcasieu Pass offset higher sales volumes at other projects.