Journal Of Researches Energy Law Studies

Journal Of Researches Energy Law Studies

Conditions and Effects of Force Majeure in Long-Term Gas Sales Contracts with Emphasis on the Decision in the Mieco and Pioneer Case

Document Type : ISI

Authors
1 Associated Profesor, Deprtment of Law, Faculty of Law & Political Science, University of Tehran, Iran
2 PhD Candidate in, Department of Public Law in (Oil and Gas Law), Faculty of Law & Political Science, University of Tehran, Iran.
10.22059/jrels.2026.387991.580
Abstract
Introduction
Among the characteristics of gas production and sales projects, we can mention the very high and long-term investment volume, the direct connection with public interests, the limited gas resources, monopoly, and the regional nature of the gas market. Therefore, the importance of providing and supplying energy to governments and fulfilling obligations for the main parties to the contract, including the seller and the buyer, is essential. This is while there may be situations where it is not possible to continue to fulfill obligations for a temporary period or even permanently. These events, provided that they meet the requirements and conditions as examples of force majeure, require that arrangements be designed and included to minimize the losses of each party, including the party unable to fulfill the obligation and affected by the incident, as well as the other party to the contract. This will be possible through the force majeure clause based on the allocation and sharing of risk in a fair and equitable manner when drafting the gas purchase and sale contract. Therefore, the institution of force majeure, its instances and requirements, the duties and responsibilities of the parties to the contract when force majeure occurs, its impact on the contract, as well as its performance guarantees among oil and gas sector actors, including gas sales contracts, have been accepted as an exception to the principle of the necessity of adhering to contractual obligations, which is the subject of this research.

Method
The method used in this research is descriptive-analytical, and it is based on the opinions of lawyers in books and articles, arbitration opinions, theses and dissertations, as well as contracts, including domestic and foreign sources. Considering that, in the case of some sources, it is not possible to access the books physically, electronic files of domestic and foreign books and articles have been used.

Conclusions
In gas purchase and sale contracts, due to the specific nature of the subject matter of the contract, the definition and determination of instances, as well as the clarification of the exceptions, must be done with sufficient care because mentioning the instances in an exclusive or illustrative manner will be of considerable importance when interpreting the contract between the parties. In other words, the broad force majeure clause in this type of contract is in favor of the buyer, and the narrow clause is in favor of the seller. Therefore, in order to achieve the maximum benefits of the contracting parties, each of the instances of force majeure and the limits of acceptance or non-acceptance of the risk of its occurrence must be carefully examined by each party. In order to benefit from the exemption resulting from the failure to fulfill contractual obligations by the obligor, it is necessary to prove the following: within a reasonable period of time that is not considered a delay according to the contract, to inform the other party of the matter and to take all reasonable measures to reduce or avoid the event or conditions in question or their consequences, and to take all reasonable measures to bring the force majeure event to a conclusion as soon as possible. In addition to informing and taking preventive measures, access to facilities is also an obligation.
According to the general rules of contracts, the effect of a force majeure event is to relieve the obligor of liability as an exception to the principle of enforceability of contracts. However, in the gas sales contract, the scope of the consequences of force majeure is stated broadly due to the strategic nature of the subject matter of the contract and the high importance of fulfilling the obligations of the buyer and seller under the contract. Its scope depends on the contractual conditions and the obligations accepted therein, which include temporary suspension of the contract, extension of the contract, renegotiation of the terms of the contract, termination of the contract, as well as matters specific to gas purchase and sale contracts, such as cash payment and adjustment of the amount of gas.
Ultimately, the nature of the force majeure clause in gas purchase and sale contracts is the same as that under the general rules of contracts, functioning as a factor that removes liability for failure to fulfill contractual obligations, but in defining and determining instances, exceptions, obligations and duties of the contracting parties, and establishing the causal relationship, it has more detailed and stricter regulations. In addition to the guarantees of execution of the general rules, it has its own guarantees of execution to prevent the abuse of this important institution as an exception to the principle of necessity and adherence to contractual obligations, and also to provide the maximum accumulation of the interests of the parties.
Keywords
Subjects

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