Arbitration rules in favour of BP as sole buyer of Kosmos Energy's Senegal LNG project
LONDON, Oct 8 (Reuters) - Kosmos Energy said on Tuesday a Paris-based arbitrator has ruled in favour of BP, prohibiting Kosmos from selling to third parties liquefied natural gas from the Greater Tortue Ahmeyin (GTA) project offshore Senegal and Mauritania.
LNG is key to BP's strategy and broader energy transition plan. The energy major has managed to establish a significant LNG portfolio across the world including Sub-Saharan Africa, which is set to become a significant source of LNG exports with Nigeria, Angola, Cameroon and Equatorial Guinea already shipping large volumes.
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Last year, Kosmos Energy, a U.S.-listed oil and gas exploration company, and BP Gas Marketing, a BP subsidiary, sought arbitration from the International Chamber of Commerce over planned LNG sales from Phase 1 of the GTA project.
The chamber informed Kosmos Energy Ltd that a final, binding award prohibits it from selling LNG cargos to third parties during the contract term of the LNG sales agreement, which has an option to end in 2033, Kosmos said in a statement.
The final award does not change the terms of the LNG sales agreement and is not expected to have an impact on Kosmos' long-term expectations and financial situation, the statement said.
BP, which holds a 56% stake in GTA, is the operator of the project and its subsidiary is the sole buyer of its 2.5-million metric ton per year volume under a 20-year contract.
In November 2023, BP said the project was 90% complete and would start in the first quarter of 2024, slightly later than originally planned.
On Tuesday, Kosmos CEO, Andrew Inglis told a BloombergNEF conference in London that the GTA project should start up by the end of the year. Kosmos has a 26.8% share in the project.
BP, Shell and other energy companies have also been in a legal battle with Venture Global LNG, accusing the LNG producer of denying it and other customers access to supplies while exporting more than $18 billion worth of the superchilled gas, according to a filing with U.S. regulators.
(Reporting by Marwa Rashad; Additional reporting by Nina Chestney; Editing by Emelia Sithole-Matarise)