Price Reviews in the Asian LNG Market

摘要

1. Current conditions in the Asian LNG market are likely to produce further price review disputes. 2. Arbitral tribunals may be willing to rewrite pricing mechanisms under SPAs, moving away from the oil-linked JCC formula. The ICC awards in RWE v Gazprom and Edison v Razgas suggest that parties to LNG contracts in Asia may be able to seek a revision of their pricing arrangements which abandons the JCC formula in favour of a gas indexed mechanism. However, it would not be prudent to read too much into these decisions without knowing the full details of the awards. Any future price reviews will focus on the exact wording of the clause in question, as well as the market in which the parties operate.