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24-06-2019 (Singapore)

P17156 Strategic Coal Pricing and Negotiations
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Strategic Coal Pricing and Negotiations

24 – 25 June 2019 | Mandarin Orchard Singapore

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overview

Key Learning Outcomes

  • The Coal Commodity Cycle and its Impacts on Coal Prices
  • Scrutiny of Coal pricing, demand, shipping and procurement strategies 2019 and beyond
  • The Fundamentals of Determining FOB Coal Prices
  • Methodologies and data sources for estimating FOB coal price indices
  • Methods and data sources for estimating and interpreting dry bulk shipping costs
  • Supply and Demand considerations for price setting and structuring
  • Documenting price adjustment provisions in Coal Supply Agreements
  • Relationship between coal price and coal quality
  • Price re-openers: How to address in a Coal Supply Contract
  • Coal price negotiations – key issues to take into account
  • Payment terms, interests and penalties
  • Regulatory factors and their impacts on coal prices

 Who Should Attend

  • Coal Mining Companies and Suppliers
  • Coal Traders
  • Coal Buyers
  • End users and consumers of coal
  • Financiers
  • Lawyers, Accountants and Industry
  • Consultants
  • Coal Derivatives Traders and Professionals from Commodity Exchanges
  • Government, State Owned Enterprises, and Regulators

pricing

Packages Price
2 Day Training$3495Early Bird

Early Bird Rate: SGD 3,295 (SGD 200 off normal rates)
Register and Pay on or before 26 April 2019

In-House Training
Save up to 40% off normal rates! (8 or more attendees)

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.
  • View payment terms and bank transfer details, click here »

trainer

Dr. Bart Lucarelli

Managing Director - Power & Utilities, AWR Lloyd

Agenda

Day 1

OVERVIEW OF THE ASIAN COAL MARKET AND INDONESIAN AND AUSTRALIAN COAL INDUSTRIES

  • Introduction to seminar objectives and organizational approach
  • Asia-Pacific Thermal Coal Production, Exports, Consumption Trends (2010-2018)
  • Brief History of Coal Price Discovery methods in Asia + Evolution of Price Indices (1970 – 2002)
  • Introduction to Major Issues affecting the Asia Pacific Coal Industry and Asian Coal Markets
    • Shifts in Coal Availability by Quality
    • Government Regulation
    • Climate Change and Shifts in lender and
    • investor interest
    • Transport- IMO Marpol Annex VI

FOB PRICE REPORTING BASIS AND INDEX REVIEW

  • Types of coal prices and the significance of reporting basis to coal price
  • Main FOB steam coal price indices currently being used in Asia
  • Methodology and data sources for each of these coal price indices
  • Coal index price series: How have they varied between 2010 and 2018?
  • Steam coal commodity cycles & the impacts of “market sentiment” on FOB steam coal prices
  • Strengths and weaknesses of each index including comparative trend analysis
  • Using statistical methods to select an appropriate coal price index
  • Common mistakes and errors in setting and interpreting FOB coal prices

DETERMINING THE COST OF SHIPPING

  • Methodology and data sources for calculating shipping costs
  • The Baltic Exchange indices and their role in setting sea transport costs in Asia
  • NETPAS as a tool for calculating shipping distances
  • Case study & sensitivity analyses of shipping costs using sea transport cost model
    • Distance (Australian vs. Kalimantan ports)
    • Fuel usage efficiency vs. speed
    • Price of bunker
    • Term of contract
    • Consecutive vs. non-consecutive voyage
    • contracts
    • Port declared as open position for vessel
    • Loading/unloading rates
    • Port costs
  • Short exercises for calculating Sea Transport Costs from Indonesia to India and China via either a Panamax or a Cape vessel

FOB PRICE SETTING: COAL PRODUCER’S PERSPECTIVE

  • Cash costs as a tool for making short term production decisions
    • Components of total cash costs and expected margins
    • Examples of cash cost estimates for Indonesian and Australian coal suppliers
    • Relationship between a coal supplier’s expected coal price and his coal quality
    • Factors affecting cash costs of coal producers over time
  • Long term production decisions based on DCF analysis

FOB PRICE ASSESSMENT: IPP COAL BUYER’S PERSPECTIVE

  • Short and long-term demand considerations
  • DCF methodology for evaluating new power plant projects
  • Comparison of levelized tariffs for coal vs. gas-fired power plants under different price scenarios for coal and natural gas
  • Implications for power plant technology selection

Day 2

PRICE PROVISIONS OF A TYPICAL COAL SUPPLY AND TRANSPORTATION AGREEMENT (PART 1)

  • Process of soliciting coal bids and negotiating price provisions of a CSTA
  • Selecting an FOB price index, setting and changing the initial coal price over time

PRICE PROVISIONS OF A TYPICAL COAL SUPPLY AND TRANSPORTATION AGREEMENT (PART 2)

  • Ordering of optional and pre-COD quantities
  • Cancelling shipments
  • Possible terms and rationale for Buyer’s relief of minimum take obligations
  • Timing of payments (days grace, LC requirements, interest for late payment)
  • Provisions for replacing a discontinued or obsolete price index

FOB PRICE ADJUSTMENTS RELATED TO COAL QUALITY

  • Standards for sampling and testing of coal quality
  • Definition of a “statistically significant” quality difference
  • Draft surveys at load port and discharge port: How to reconcile any differences
  • Options for Seller to “make good” a rejected shipment

TRANSPORT PRICE ADJUSTMENT TERMS AND RELATED PRICE PROVISIONS

  • Base quantity transport price contract terms
  • Base quantity transport price adjustment equations

PRICE CASE STUDY 1

INDONESIA’S HBA/HPB COAL PRICE REGULATION

  • Market analyses and coal pricing 2018, 2019 and beyond
  • The methodology for calculating HPBs for specific coal types
  • Illustration of how HPBs are calculated and their relationship to coal prices that are published periodically by Platts, Argus Media and globalCOAL
  • Potential impacts of HPBs on Indonesia’s export coal prices and the demand for Indonesian coal
  • Do holders of CCOWs have to sell their coal exports at the HPB?

 PRICE CASE STUDY 2:

Attendees will complete a quantitative exercise using Excel for which they will calculate the HPB for a specific coal type and then compare that the HPB price on a US$/GJ basis against the gcNEWC price after normalizing the gcNEWC price for the same CV as the coal type used for the HPB calculation

SEMINAR WRAP-UP INCLUDING FINAL Q&A SESSION

 

when & where

24 - 25 Jun 2019

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

On-site & in-house training

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