Saturday, September 20, 2008

My Force Majeure

Sat 20 Sep 2008, 8:47 GMT
LAGOS (Reuters) - Royal Dutch Shell said on Saturday it had declared a second force majeure on crude oil shipments from Nigeria following militant attacks in recent days on its facilities in the Niger Delta.

Shell last week extended a force majeure, which frees it from contractual obligations, on Bonny oil exports from Nigeria following a militant attack in late July.

It said it had declared the second force majeure on Bonny Light shipments on Friday, following further attacks by militants this week.

This from the Yale law library:
Force Majeure literally means "greater force". These clauses excuse a party from liability if some unforseen event beyond the control of that party prevents it from performing its obligations under the contract. Typically, force majeure clauses cover natural disasters or other "Acts of God", war, or the failure of third parties--such as suppliers and subcontractors--to perform their obligations to the contracting party. It is important to remember that force majeure clauses are intended to excuse a party only if the failure to perform could not be avoided by the exercise of due care by that party.

(((Of course, one might argue that with due care on the part of shell the people in Nigeria wouldn't be starving, drinking oil coated water or be getting so damned sick of it in the first place...)))

When negotiating force majeure clauses, make sure that the clause applies equally to all parties to the agreement--not just the licensor. Also, it is helpful if the clause sets forth some specific examples of acts that will excuse performance under the clause, such as wars, natural disasters, and other major events that are clearly outside a party's control. Inclusion of examples will help to make clear the parties' intent that such clauses are not intended to apply to excuse failures to perform for reasons within the control of the parties.

One can imagine the contract now... if rebels come to attack the facility because they want me to leave the country we have been exploiting for all these years, then we will be relieved of the contracts we have signed to deliver oil to more prosperous nations.

And I am so self centered... I'm thinking about what in my life I would like to excersise a Force Majeure upon...

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