Epc Contracts For Wind Energy Projects - South African Re Ipp Programme - Lessons Learned From Phases 1 And 2 (October 2012) Part 7

Drafting force majeure clauses

The appropriate allocation of risk in project agreements is fundamental to negotiations between the project company and its contractors. Risks generally fall into the following categories:

• risks within the control of the project company;
• risks within the control of the contractor; and

• risks outside the control of both parties.

The negotiation of the allocation of many of the risks beyond the control of the parties, for example, latent site conditions and change of law, is usually very detailed so that it is clear which risks are borne by the contractor. The same approach should be adopted in relation to the risks arising from events of force majeure.