Gas sale and purchase agreements

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exclusions of liability for consequential or indirect loss, (ii) liability and

indemnities for third-party claims, (ii) liability and indemnities for loss or
damage to property and injury or death to employees, (iii) monetary caps on
the liability of one party to the other, (iv) conduct of claims, (v) duty to
mitigate losses and/or (vi) any express remedy for breach contained in the
GSA constituting the non-breaching partys sole and exclusive remedy.
Insurance: each party will normally be under an obligation to effect and
maintain certain insurances for the duration of the GSA, including insurance
in respect of its facilities and third-party liability insurance.
Confidentiality: each party will normally be subject to obligations of
confidentiality regarding the GSA.
Governing law: as with any commercial contract, the GSA will stipulate a
governing law. In GSAs involving the cross-border sale of gas, the parties will
usually stipulate a neutral governing law that is internationally recognised in
the petroleum industry as possessing a well-developed body of law that will
afford the parties with a degree of certainty and predictability in contractual
interpretation and the outcome of claims.
Dispute resolution and arbitration: putting aside disputes which are referable to
an expert for determination and informal dispute-resolution procedures
(such as alternative dispute resolution), most GSAs will provide that disputes
arising between the parties shall either be referred to the applicable courts for
litigation or to arbitration. International arbitration, either institutional
(such as the International Chamber of Commerce International Court of
Arbitration (ICC), or the London Court of International Arbitration (LCIA)),
or ad hoc in accordance with the United Nations Commission on
International Trade Law (UNCITRAL) rules, tends to be common in GSAs
involving the cross-border sale of gas or international parties.
Expert determination: under the GSA certain disputes may be referred to an
independent third-party expert for determination. These matters will usually
be limited to technical matters such as disputes relating to measurements,
calculations, invoicing and/or force majeure. The provisions relating to the
expert will normally address matters such as appointment, conduct of the
expert determination, nature and status of the experts determination (eg,
non-appealable and binding) and the apportionment between the parties of
costs relating to the expert determination.
Representation and warranties: each party will normally give standard
representations and warranties in favour of the other party.48 The buyer will
also normally insist on the seller warranting that it has title to all gas to be
delivered under the GSA and that such gas is free from all encumbrances and
adverse claims. In addition, the seller and/or the buyer may insist on the

Standard warranties may include (i) that the party has been validly incorporated, (ii) that the party has
the requisite authority to enter into the GSA and perform its obligations under the agreement, (iii) that
the GSA is binding upon, and enforceable against, the party in accordance with its terms, and (iv) that
the party is not subject to any proceedings or litigation which may adversely affect its ability to perform
its obligation sunder the GSA.