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Osaka Gas bucks trend with PNG arbitration

Osaka Gas's turn to price review arbitration over its contract with PNG LNG is thought to mark the first time a Japanese buyer has made such a move Osaka Gas's turn to price review arbitration over its contract with PNG LNG is thought to mark the first time a Japanese buyer has made such a move.
By Damon Evans 25 July 2019 Asia Pacific / LNG 0 34432
An LNG cargo loading at PNG LNG in Papua New Guinea. (Santos)

Japanese utility Osaka Gas is pursuing a price review arbitration against the ExxonMobil-led PNG LNG venture, signaling that Japanese LNG buyers are prepared to act more aggressively than ever before in their efforts to lower prices in their contracts.

Although arbitrations are usually private matters between two parties, well-informed sources at LNG-buying companies have confirmed the proceedings are taking place, Saul Kavonic, an Australian-based energy specialist at Credit Suisse, told Interfax.

Osaka Gas is seeking to reduce the slope in its oil-indexed term sales contract. Most existing term deals...