In the midst of the spread of financial transactions around the globe, arbitration is gaining ground as an effective dispute resolution method. The incremental nature of its methodology seems to some extent to surpass the rigid characteristics of litigation. Although litigation is well established, recent practices deployed in the context of the International Swaps and Derivatives Association (ISDA) master agreement, the development of the Panel of Recognised International Market Experts in Finance (PRIME Finance) and a current ICC Report on Financial Institutions and International Arbitration call for new empirical data on the workability of arbitration in this respect. This paper seeks to demonstrate arbitration’s compatibility with project finance transactions, mostly through a comparative analysis of arbitration and litigation. The author explains the nature of these international transactions, the most appropriate forum for the disputes that arise and the optimal method of resolution. This is an attempt to balance the interests of the contracting parties and justice. A new international financial court, the author suggests, may be the most competent body to resolve this kind of dispute effectively.