MAY UPDATE: COVID-19 AND ITS POTENTIAL IMPACT ON LNG TRADING -FORCE MAJEURE

摘要

In recent years, driven by the impact of both macro-economic environment and environmental-protection policies, China has gradually become one of the world's major natural gas importers. However, the exploration, development, production, transportation and other processes relating to natural gas can be significantly affected by natural factors such as lightning, earthquake and floods; and social factors such as large-scale epidemics, change of government policy and even changes in the international, social, political and economic environment. At the beginning of 2020, the sudden outbreak of the Coronavirus Disease 2019 (COVID-19) "sounded the alarm", reminding Chinese energy enterprises of the need to pay attention to the potentially adverse effects of various factors on "contractual performance". It is of great importance to incorporate force majeure clauses in international sale and purchase contracts relating to liquefied natural gas (LNG) to prevent, control and resolve market risks in an effective way.