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European oil majors have asked a cross-Atlantic government task force to intervene in a dispute with Venture Global LNG Inc., warning that the US supplier “reneging” on contracts to supply liquefied natural gas threatens Europe’s energy security and undermines the US as a reliable supplier.
In separate letters, Shell Plc and BP Plc accuse Venture Global of “misconduct” for withholding fossil-fuel cargo agreed under long-term contracts and instead opting to sell LNG on the spot market at higher prices. The letters Bloomberg News has seen were sent by the companies in October to an energy-security task force set up by the US and European Union.
Venture Global responded on Nov. 10, saying that the accusations are “false” and that a request for governments to interfere in agreements among private companies is “outrageous.”
The FT first reported on the letters. It cites another from Italy’s Edison SpA claiming Venture Global stands to gain $17.5 billion from short-term market sales, compared to $2.8 billion under long-term contracts, according to a Wood Mackenzie report.
Venture Global said the “highly coordinated attack” by the European energy industry is an attempt to “modify their contracts and stifle competition” in the global LNG market.