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16-07-2018 (Singapore)

P52248 Advanced LNG Contracts
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Advanced LNG Contracts

16 – 17 July 2018, Mandarin Orchard Singapore, by Meritus

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Team Savings: Register 2 Delegates & the 3rd Comes free!

overview

Key Learning Outcomes

  • Gas trading hubs – what does this mean for commercial contracting
  • Key issues within LNG Sale & Purchase Agreements (SPAs)
  • The traditional LNG contract – key aspects reviewed (quantity; quality; conditions of delivery i.e. FOB; CIF, DES etc.)
  • Negotiation, Renegotiation and Reopeners
  • The Annual Contract Quantity (ACQ)
  • Buyer and Seller obligations
  • Contract settlement (invoicing and payment
  • Chartering, Transportation and Loading provisions
  • Case Studies and Practical Exercises on
  • A SPA dissected
  • Examining a diversion provision
  • Negotiating diversion rights

Who Should Attend

Any executive from LNG Suppliers, Traders, Importers, End Users and Financiers involved in contract negotiations and administration, including but not limited to

  • Marketing, Sales and Business Development
  • Contracts, In house Counsel and Pricing specialists
  • Commercial, Procurement and Financial controllers

pricing

Packages Price
2 Day TrainingSGD $3495Early Bird

Early Bird Rate: Register And Pay On Or Before 18 May 2018

Register 2 Delegates & the 3rd attends FREE!
Group rate is based on normal rate of 2-day main conference package only.
For Group Registrations, email register@ibcasia.com.sg or call +65 6508 2401

 

  • Special Group Discount pricing is applicable to groups of 2 or more delegates from the same organisation registering for the same event, at the same time.
  • Fee stated is the discounted price PER DELEGATE. Only one discount applies – either the early bird rate OR the Special Group Discount.
  • All fees stated include luncheons, refreshments and complete set of documentation. It does not include the cost of accommodation and travel.
  • A 7% Goods & Services Tax (GST) is applicable to all Singapore based companies for Singapore venue.

trainer

Christopher Lennon MBA, LLB, DipICArb, FCIArb, AIPN

Director, Stone Falcon Corporate & Legal Consulting Ltd

Agenda

TOPIC 1: AN INSIGHT INTO THE LNG MARKET

  • An evolving market – making the right strategic choices – maximizing opportunities, mitigating threats
  • Capacity issues (greater demand for gas for power generation; ‘floating infrastructure; transportation fuel substitute, etc.) and delivery capabilities
  • Increasing global infrastructure (new pipelines; more LNG maritime transportation;) – a greater emphasis on ‘spot’ markets?
  • Security of supply – increased or decreased certainty?
  • Where is the destination market? A very key variable of consideration
  • Long term oil indexed prices – a thing of the past?

TOPIC 2: KEY FEATURES OF DEVELOPED GAS TRADING HUBS – WHAT DOES THIS MEAN FOR COMMERCIAL CONTRACTING?

  • Degree of regulation
  • Number of buyers and sellers
  • Developed/access to transportation infrastructure
  • Substantial trading volume
  • Transparency in price and volume reporting
  • Degree of liquidity to create indexation
  • Futures trading

TOPIC 3: OVERVIEW OF SOME KEY ISSUES WITHIN LNG SALE & PURCHASE AGREEMENTS (SPAS)

  • The traditional LNG contract – key aspects reviewed (quantity; quality; conditions of delivery i.e. FOB; CIF, DES etc.)
  • Examining portfolio spa’s – a better way forward?
  • Standardization – the best way to promote transparency in contracts? Key benefits of standardization – reduction in uncertainty – cost reduction in terms of time and price
  • An end to destination clauses? Re-selling cargos into the spot market – an efficient way to reduce import costs? Renegotiation
  • Why stabilization clauses are a good idea
  • Reopener clauses
  • Renegotiation (oil indexed vs. gas hub prices) clauses – the problem of project investment and FID
  • Renegotiation clauses – combating the impact of price divergence due to market volatility
  • Stabilisation clauses
  • The confirmation memorandum

Case studies: A SPA dissected

TOPIC 4: KEY NEGOTIATION ISSUES WITHIN A SPA

  • Term
  • Force Majeure – scope of FM events pertinent to the contract; exclusions; resumption of normal performance; rights of parties in the event of a FM event
  • Termination protocols
  • Assignment issues
  • Breach
  • Liability and consequential loss
  • Dispute resolution mechanisms (clauses)
  • Warranties and guarantees
  • Relevant incoterms
  • Vessel/terminal/berthing facilities and any upgrades required
  • Stakeholder identification and management
    • local content provisions (example – Barrow Island)
  • Quantum of liquidated damages – when LDC’S are triggered – cap and collar valuations

TOPIC 5: DIVERSION RIGHTS IN A SPA:

  • The buyer’s (inclusion) and the seller’s (limitation) perspective relative to diversion rights
  • Commercial rationale – key reasons for including diversion provisions
  • Storage and capacity – 2 other key reasons for the inclusion of diversion provisions
  • Diversion rights and Force Majeure
  • Ship to shore compatibility issues (seller’s perspective)
  • Diversion provisions and destination clauses – a potential conflict?

Case study – examining a diversion provision
Class exercise – negotiating diversion rights

TOPIC 6: THE ANNUAL CONTRACT QUANTITY (ACQ):

  • Stipulation of ACQ and units to be utilised
  • Annual date of commencement, annual date of cessation
  • The AACQ
  • Round Up and Round Down Quantities
  • Impact on AACQ due to scheduled major maintenance and inspection works

TOPIC 7: BUYERS PURCHASE OBLIGATIONS – TAKE OR PAY GROUNDS FOR REDUCTION IN AACQ:

  • Quantity reductions due to seller’s actions (including Force Majeure)
  • Quantity reductions due to buyer suffering
  • Force Majeure event(s)
  • Buyer issuing a ‘Notice of Suspension’
  • The ‘Cargo Shortfall Quantity’
  • Mitigation sales

TOPIC 8: SELLERS PURCHASE OBLIGATIONS:

  • Quantity reductions due to buyer’s actions (including Force Majeure)
  • Buyer issuing a ‘Notice of Suspension’
  • The ‘Cargo DoP Quantity’ (deliver or pay)

TOPIC 9: LNG VESSEL CHARTERING:

  • The traditional perspective (single project, long term) -challenged by the growing ‘spot’ (short term) or medium term (designated number of cargos) market evolution?
  • Key stakeholders in vessel chartering
  • Contracts of Affreightment
  • Cargo ‘swaps’
  • Voyage charters
  • Shelltime4
  • Exxonmobiltime 2000

TOPIC 10: TRANSPORTATION AND LOADING:

  • Adverse weather conditions provisions
  • Compatibility of tankers with loading facilities
  • Tanker inspections
  • Port liability agreements
  • Loading of tankers
  • Notice of Readiness
  • Berthing assignments
  • Berth laytime
  • Excess laytime (tanker not ready to load)

TOPIC 11: CONTRACT SETTLEMENT (INVOICING AND PAYMENT):

  • The buyers’ and sellers’ obligations to the contract (purchase and supply), (liability for shortfall)
  • Statements of LNG not taken; unavailable or undelivered
  • Payment terms (due dates; currency and payment methodology)
  • Late payment and refunds
  • Sellers rights to suspend performance
  • payment disputes

when & where

16 - 17 Jul 2018

Mandarin Orchard Singapore, by Meritus
333 Orchard Road, Singapore 238867
Tel: +65 6831 6062 | Fax: +65 6737 3130
Mobile No.: +65 8298 9442
Contact Person: Tan Ai Li
Email: aili.tan@meritushotels.com
Website: www.meritushotels.com

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