Trading companies, Vitol and Glencore will receive $380 million in compensation following a London court ruling against Nigeria LNG (NLNG) over the non delivery of contracted cargoes, according to court documents.
The ruling, which rejected NLNG’s appeal, stems from a legal battle initiated by trading firm Taleveras.
Taleveras, which had pre sold some of the undelivered cargoes to Vitol and Glencore, took legal action against NLNG four years ago. The case, heard in the London High Court and Court of Appeal, focused on 19 cargoes that NLNG failed to supply between 2020 and 2021.
Last week, the Court of Appeal upheld the initial ruling, ordering NLNG to pay approximately $260 million to Vitol and $120 million to Glencore.
A full written judgment is expected in the coming weeks.
NLNG, which operates Nigeria’s largest LNG plant and contributes around 5% of global supply, said it was reviewing the ruling but declined further comment.
Its shareholders include Shell, TotalEnergies, and Eni, with the Nigerian National Petroleum Company (NNPC) holding a 49% stake. Shell and Eni also declined to comment, while TotalEnergies did not respond to inquiries.
Impact on global LNG market
The ruling is part of a broader wave of legal actions against LNG producers accused of withholding contracted supply during the post-pandemic gas price surge.
After gas prices fell to record lows in 2020 due to the COVID 19 pandemic, the market saw a sharp rebound following Russia’s invasion of Ukraine in 2022.
European benchmark gas prices swung from €3.63 per megawatt hour in 2020 to €311 per MWh in 2022.
As prices surged, some producers prioritized selling cargoes on the spot market instead of fulfilling long term contracts, leading to legal disputes.
In a similar case, Shell and BP pursued arbitration against U.S. based Venture Global LNG for failing to supply contracted cargoes.
Taleveras, founded in 2004 by Nigerian energy trader Igho Sanomi, has not disclosed how much it stands to receive beyond the $380 million awarded to Vitol and Glencore.
