FORCE MAJEURE CLAUSES IN LONG-TERM GAS CONTRACTS (OR ARE THE FRENCH REALLY SMARTER THAN THE REST OF US?)

Abstract

Force majeure clauses are a vital component of all long term gas contracts, whether relating to transportation or sale. The very nature of these contracts means that a consideration of a force majeure clause is virtually inevitable during the life of the contract. In addition, the clause applies to all phases of a gas project, from construction to purchase, supply, transportation and sale. The purpose of this paper is to examine the place that force majeure clauses have in the context of long term gas contracts, concentrating on the commercial and practical issues which need to be considered when negotiating them. It will also cover the potential that the principle of force majeure has to be used to the advantage of a party negotiating a gas contract.