The HC Commodities Podcast

Episode: Disputes, Arbitration and Navigating a Fractious Commodities World with Alex de Gramont

Host: Paul Chapman (HC Group)
Guest: Alex de Gramont, Partner and Head of International Disputes, Womble Bond Dickinson
Date: September 16, 2025

Episode Overview

This episode explores the rapidly evolving world of international disputes and arbitration in the commodities sector, particularly energy and natural resources. Host Paul Chapman speaks with international arbitration expert Alex de Gramont about why cross-border disputes are proliferating, the legal mechanisms for resolving them, and practical advice for executives and companies operating in today’s more volatile, fractious world. The conversation covers the history and mechanics of arbitration, the impact of geopolitical fragmentation, strategies for dispute avoidance and resolution, current enforcement challenges against state actors, and the changing skills and resources needed to succeed in international disputes.

Key Discussion Points & Insights

1. The Growth and Role of International Arbitration in Commodities

[03:21]

• Oil and gas arbitrations trace back to the 1950s, often involving Western and Middle Eastern countries, with the sector marked by volatility, resource nationalism, expropriations, and legal unpredictability in many nations.
• International arbitration provides a neutral forum with specialist arbitrators, circumventing unpredictable or biased domestic courts.
• Parties often choose neutral laws (e.g., English, French) and seats (e.g., Paris, London) for proceedings.

Quote:
"The idea behind international arbitration is that it provides a neutral forum, really for both sides… They can choose, typically three neutral arbitrators, and they might apply a neutral law."
— Alex de Gramont, [03:43]

2. Alternatives to Arbitration & Enforceability

[05:39]

• Without arbitration, disputes typically end up in domestic courts, often skewed toward the home party.
• The New York Convention (1950s), with over 170 signatories, compels enforcement of arbitral awards across borders, giving arbitration teeth that court judgments often lack internationally.

Quote:
"If you have an arbitration agreement, the other side... will come to the arbitration a neutral city, a neutral state, and will be bound by international treaties to pay the judgment."
— Alex de Gramont, [07:06]

3. How Arbitration Clauses are Structured

[08:31]

• Contracts often include not only the choice of law but an explicit arbitration process, forum, and rules (e.g., ICC, Paris).
• De Gramont gives an example from Mongolia: a Canadian company invested in a uranium mine structured its dispute process through Parisian arbitration under ICC rules, yielding a binding and voluntarily paid award.

4. Timing, Duration, and Enforcement

[10:23], [11:53]

• Arbitration duration varies: large state cases may last a decade; commercial disputes may resolve in ~2 years, faster than many courts.
• Enforcement challenges:
  • Commercial entities generally pay or have attachable assets;
  • Governments have sovereign immunity protections and only commercial assets can be seized.
  • Recently, some major nations (e.g., Russia, Venezuela) have refused to pay, forcing claimants to chase assets worldwide, sometimes aided by courts outside the EU despite EU legal blockades.

Quote:
"It used to be that governments would always pay the awards. I think it was really Russia who started the trend of not paying awards, leading the claimants to have to go and chase assets."
— Alex de Gramont, [12:15]

5. The Changing Geopolitical and Legal Landscape

[14:21]

• Modern energy and resources transactions are more complex: tariffs, price volatilities, and more frequent contract breaches push disputes up.
• Simultaneous erosion of international order and Balkanization of states mean legal frameworks are less reliable and global cooperation harder.
• Arbitration arose post-WWI to enable neutral, commerce-friendly dispute resolution and promote peace; institutions like the ICC (Paris, 1923), Stockholm Chamber, and American Arbitration Association emerged in the aftermath.

Quote:
"If you could promote international commerce business between peoples of different nations, that would promote mutual understanding and peace. And one of the ways to promote international commerce was by providing a neutral, independent forum in which to resolve those disputes."
— Alex de Gramont, [16:41]

6. Recent Trends: Globalization to Fragmentation

[21:21], [25:12]

• While disputes and resource nationalism are constants, de Gramont notes more recent regression in international legal cooperation and a move toward alternative blocs/trade partners (China, Russia, BRICs).
• Economic and political events (e.g., Russia’s invasion of Ukraine, energy used as a weapon, sanction regimes) have fragmented global trade, lessening incentives for universal enforcement of judgments.

Quote:
"There are far more markets, far more consumers… you have the involvement of the United States and Russia and Europe in what is not only a political and military dispute, but a dispute that's using energy as a weapon."
— Alex de Gramont, [25:56]

7. Best Practices: Contractual Risk Mitigation

[28:25]

• For investments in legally/politically unpredictable countries, an international arbitration clause is vital.
• For more "developed" legal environments (e.g., US, UK, France), risk is lower, but for many resource-rich countries, this is essential.
• Upfront legal structuring, arrester language, and ensuring arbitrability can profoundly impact later leverage and recovery.

8. Selection and Structure of Arbitrators

[29:11], [31:49]

• Typical tribunal: each side selects one arbitrator; the third (chair) mutually agreed or chosen by the institution (e.g., ICC).
• Arbitrators are selected for sector expertise and neutrality; chairs often have specialist knowledge and are of a third nationality.
• Centers are mostly non-profit (ICC, Stockholm Chamber, LCIA) with their own rosters, but parties can select outside experts if needed.

Quote:
"If a person has had lots of experience in LNG disputes... the parties and the institution might try to find arbitrators with experience in that particular area."
— Alex de Gramont, [30:18]

9. Strategic Considerations in Disputes

[35:34], [37:31]

• Legal expertise at the contract drafting phase is crucial (e.g., not seating arbitration in an inexperienced forum).
• Preparedness strengthens leverage in settlement; most disputes settle due to commercial incentives.
• Strategies when a dispute arises:
  • Explore all settlement avenues, including governmental or PR interventions.
  • Secure best expert witnesses early (especially in technical or niche sectors).
  • Build a team with language, local, and industry expertise as needed.

Quote:
"The stronger the arbitration clause and the more enforceable it is, and the more prepared you are for the arbitration, the more leverage you will have for settlement."
— Alex de Gramont, [36:02]

10. Expert Witnesses and Team Composition

[39:08], [41:01]

• Blending economic and industry expertise is standard; prior testifying experience often preferred for navigating rigorous cross-examination, but fresh voices can add value.
• Large, complex cases may require co-counsel in relevant jurisdictions and teams with appropriate language and regional knowledge.

11. Financing International Arbitrations

[43:12]

• Arbitrations, especially against state actors, are long, expensive, and recoveries uncertain.
• Third-party funding is a growing tool: allows smaller or risk-averse companies to proceed while sharing risk and adding funder-analyst scrutiny.
• Funders’ willingness to back a case is a positive sign of its prospects.

Quote:
"Even some mid-size and larger companies want to hedge the risks and have a third-party funder funding some or all of the case… third-party funders can be tremendously helpful"
— Alex de Gramont, [43:22]

12. Careers in International Arbitration

[44:57]

• International disputes offer variety, a mix of legal, business, and political challenges, and exposure to different cultures and legal systems that domestic litigation doesn’t.
• Increasing specialization and competition: aspiring lawyers should pursue relevant courses, events, research assistantships, and foreign languages as early as law school.

Quote:
"There are just so many different facets to international arbitration that you really don't see… in domestic litigation."
— Alex de Gramont, [45:42]

13. When to Call an Arbitration Expert

[47:23]

• The earlier, the better—ideally at contract drafting or when a dispute first emerges.
• Firms like Womble Bond Dickinson integrate sector-specific and international legal expertise for tailored teams, critical for complex cross-border cases.

Notable Quotes

• “International arbitration provides a neutral forum, really for both sides… you might apply English law or French law and seat the arbitration in Paris or London.”
  — Alex de Gramont, [03:43]

• “It used to be that governments would always pay the awards. I think it was really Russia who started the trend of not paying awards, leading the claimants to have to go and chase assets.”
  — Alex de Gramont, [12:15]

• “The stronger the arbitration clause and the more enforceable it is, and the more prepared you are for the arbitration, the more leverage you will have for settlement.”
  — Alex de Gramont, [36:02]

• “There are just so many different facets to international arbitration that you really don't see… in domestic litigation.”
  — Alex de Gramont, [45:42]

Key Timestamps

• [03:21] – Why international arbitration is critical in oil & gas contracts
• [07:06] – Power and breadth of the New York Convention
• [08:55] – How arbitration clauses are chosen and structured
• [11:53] – Enforcement against governments and sovereign immunities
• [14:21] – Why disputes are rising: market and geopolitical volatility
• [16:41] – Historical roots of modern arbitration
• [21:21] – Fragmentation of international order post-2015
• [28:25] – Must-have risk mitigation strategies in contracts
• [29:14] – Process for picking arbitrators
• [35:34] – Strategies once a dispute is imminent
• [43:12] – Third-party funding and case economics
• [44:57] – Why (and how) to pursue a career in international arbitration

Memorable Moments

• Alex’s anecdote about a real arbitration in Mongolia, where the system worked as intended with neutral enforcement ([08:55]).
• Reflections on the fragmentation of global markets and the diminishing consequences for "going it alone" in the current geopolitics ([23:46], [25:12]).
• Discussion of the practical complexities and expertise needed to handle arbitration—from expert witnesses to multi-lingual teams, not just law ([41:01]).
• Strong advice for companies and lawyers: involve experienced arbitration counsel at the earliest contract stage, not just when a dispute is brewing ([47:23]).

Final Takeaway

International arbitration is essential for navigating today’s increasingly unpredictable commodities sector, especially amid growing geopolitical fragmentation. Success hinges on proactive, expertly crafted contracts, early expert legal insight, multi-disciplinary teams, and an understanding of the evolving global landscape for enforcement and cooperation.