Project Finance International Publishes Akin Gump Article on Take-or-Pay Obligations
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Akin Gump partners Justin Williams and Julian Nichol have authored the article “Nominations – Talking about take-or-pay,” published by Project Finance International. The article examines a judgment by the English Court of Appeal considering “take-or-pay” obligations that the article says is of “real practical, commercial importance – not only to lawyers, but also to the wider project finance community.”
The case in question, British Gas Trading Ltd (BG) v Shell UK Ltd and Esso Exploration & Production UK Ltd, concerns “two largely identical, long-term gas sales agreements (GSAs) under which the sellers sold natural gas from the UK North Sea’s Sole Pit Reservoirs (Sole Pit) to BG.” The agreements, Williams and Nichol write, are “field-specific depletion contracts by which the sellers must provide a minimum amount of gas that BG must either take delivery of and pay for, or not take delivery of but pay for, every year.”
To read more about the case as well as some lessons to be learned from it, please click here to read the article in full.
