Gas Pipeline Arbitration

Brief

HKA was appointed by the respondent in local arbitration proceedings concerning the termination of a gas transport contract in Peru. The dispute involved assessing the validity of the contract termination and the associated financial implications, with the Claimant alleging several reasons for termination and non-payment. 

What we did

HKA leveraged its extensive experience in oil and gas matters in Latin America to conduct a comprehensive market assessment of the electricity sector in Peru. Collaborating closely with a technical expert, the team reviewed the arguments and provided two expert reports, as well as giving oral evidence at the hearing stage. This assessment involved understanding market dynamics and evaluating the reasonableness of the Claimant’s claims regarding the alleged excessive costs to it under the contract resulting from market developments. The expert also navigated the complexities of the local market and assessed the impact of the Covid-19 pandemic on the national electricity sector. 

The Covid-19 pandemic had significantly disrupted the oil and gas industry in Peru, leading to repeated shutdowns. This added a layer of complexity to the assessment, as the economic and operational impacts of the pandemic had to be factored into the analysis. Additionally, the case required the ability to navigate language barriers, with oral and written evidence being given in the Spanish language. 

Outcomes

HKA’s integrated approach, combining technical and financial expertise, provided a robust defence against the Claimant’s arguments. The collaboration with the technical expert and the detailed market assessment led to a favourable outcome, with positive feedback from the legal team. The ability to provide both technical and financial expertise under one roof ensured that the arguments were well-aligned and credible. This case highlighted HKA’s capability to handle complex, multi-faceted disputes in challenging environments, demonstrating adaptability and expertise in the oil and gas sector in Latin America. It also provided a further example of HKA’s abilities to undertake non-English language work, in this instance, Spanish being the language of proceedings.