OFF-SPEC LNG Sample Clauses
The OFF-SPEC LNG clause defines the procedures and consequences when liquefied natural gas (LNG) delivered under a contract does not meet the agreed quality or specification standards. Typically, this clause outlines the buyer's rights to reject, accept with price adjustments, or require replacement of the off-spec LNG, and may specify testing methods and notification requirements. Its core function is to protect both parties by ensuring that only LNG meeting contractual standards is accepted, thereby allocating risk and providing a clear process for addressing non-conforming deliveries.
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OFF-SPEC LNG. 6.3.1. If either Buyer or Seller, acting as a Reasonable and Prudent Operator, determines prior to unloading (in respect of an Ex-Ship Sale) or loading (in respect of an FOB Sale), an LNG Cargo that the LNG is expected to be Off-Spec LNG upon delivery, then such Party shall notify the other Party of the extent of the expected variance as soon as practicable (but in no case later than (in respect of an Ex-Ship Sale) the commencement of unloading or (in respect of an FOB Sale) the commencement of loading, of such LNG Cargo), and the Buyer and Seller shall discuss such variance and possible mitigating actions, subject to the following:
(a) Buyer shall use reasonable efforts, including coordinating with the Buyer’s Operator and Transporter (in respect of an FOB Sale), to accept Off-Spec LNG; and
(b) as soon as practicable, but in no case later than forty-eight (48) hours after giving or receiving any notification pursuant to Section 6.3.1 that LNG is expected to be Off-Spec LNG, Buyer shall notify Seller that Buyer (i) despite using reasonable efforts to accept the LNG Cargo, rejects the LNG Cargo containing such Off-Spec LNG; or (ii) subject to Section 6.3.2, is willing to accept all or any of the Off-Spec LNG. If the quality of the Off-Spec LNG delivered by Seller is not materially consistent with the expected variance notified by Buyer or Seller pursuant to Section 6.3.1, upon which expected variance Buyer’s decision pursuant to this Section 6.3.1(b)(ii) is based, then notwithstanding Buyer’s initial acceptance of such Off-Spec LNG, Buyer is entitled to reject all or part of such Off-Spec LNG pursuant to this Section 6.3.
6.3.2. If Buyer determines that it could accept Off-Spec LNG pursuant to Sections 6.3.1(b)(ii) or 6.3.4, then Buyer shall include with its notice issued pursuant to Sections 6.3.1(b)(ii) or 6.
OFF-SPEC LNG. 12.1 LNG delivered under the FOB ADP or FOB Ninety Day Schedule, as applicable, shall, when converted into a gaseous state, comply with the following specifications (“FOB Specifications”): Minimum Gross Heat Content (dry) 1000 BTU/SCF Maximum Gross Heat Content (dry) 1150 BTU/SCF Minimum methane (C1) 84.0 MOL% Maximum H2S 0.25 grains per 100 SCF Maximum Sulfur 1.35 grains per 100 SCF Maximum N2 1.5 MOL% Maximum Ethane (C2) 11 MOL% Maximum Propane (C3) 3.5 MOL% Maximum Butane (C4) and heavier 2 MOL% LNG shall contain no water, active bacteria or bacterial agents (including sulfate-reducing bacteria or acid producing bacteria) or other contaminants or extraneous material.
OFF-SPEC LNG. Without prejudice to any other rights and remedies of Buyer hereunder, Buyer may refuse to take delivery of all or part of any LNG not conforming to the quality specifications set forth in Section 6.1 (“Off-Spec LNG”), subject to Buyer’s obligation under Section 6.2(b) to use reasonable endeavors to take delivery of any Cargoes which it would otherwise be entitled to reject.
OFF-SPEC LNG