Take-or-pay clauses are common in the energy industry and, in particular, for gas sales; see volume risk.
[1]: Paragraph 40 Outside the oil and gas context, "take or pay" contract terms are often rejected by courts as unenforceable penalties.
The Oklahoma Supreme Court explained this rationale in Roye Realty & Developing, Inc. v. Arkla, Inc., 1993 OK 99, 863 P.2d 1150.
Hence, the deficiency payment obligation is not a provision designed to provide the measure of damages when Arkla fails to take and pay for gas under the contract.
"[2]In the United Kingdom, a take-or-pay clause included in a contract between M&J Polymers and Imerys Minerals was found on its own facts to be "commercially justifiable" in a 2008 High Court ruling,[1] allowing suppliers in certain contexts to maintain "confidence in using take or pay clauses in their supply contracts" so long as they have been freely negotiated by both parties.