Abstract

The development of a global LNG market followed by a growing number of related investments could lead to a respective increase in arbitral proceedings under International Investment Agreements (IIAs). In light of the above, this article aims to revisit the question of whether and to what extent the LNG value chain and the related assets are covered by the ECT’s investment protection regime. Upon introducing the relevant ECT provisions and the applicable means of their interpretation, the author examines whether LNG is included in the list of Energy Materials and Products under the ECT. The author then considers two cases: (1) Petrobart Limited v. the Kyrgyz Republic and (2) Union Fenosa Gas, S.A. v. Arab Republic of Egypt to establish whether LNG-related sale and purchase agreement (SPA) may be construed as protected Investment under the ECT and ICSID Convention respectively. Subsequently, the author discusses the due level of association of a protected asset with an Economic Activity in the Energy Sector in the meaning of Article 1(5) ECT. Further to that analysis, the possible status of different services as rendered along the LNG value chain is considered. As the next step, the article seeks to establish whether an LNG terminal may be considered as a covered Investment under the ECT. Finally, the author invokes examples of a new generation of LNG-related ships in order to establish whether those can constitute protected Investments under the ECT’s investment protection regime.