International LNG Contracts - Commercial Factors and Negotiations

Course Summary
LNG Sales and Purchase contracts generally take much longer to negotiate than equivalent pipeline gas contracts. This is not surprising in view of the very large sums and risks involved. This five-day course will give you a deeper understanding of the contractual issues as well as risks and how to mitigate them. It will also help to reduce the time (and money) spent on negotiations. The main focus of the course will be on the LNG Sales and Purchase Contract itself but it will also include the relationship to other contracts in the LNG Project from gas field to buyer's reception and vaporisation facilities.
During the negotiation sessions delegates will have the opportunity to test their understanding of the issues involved and apply the knowledge gained during this course.
What you will learn

• The overall structure of LNG projects and contractual risks and relationships
  
• The detailed structure and clauses of the LNG Sales and Purchase Agreement
  
• The main markets and pricing structures for LNG contracts
  
• Issues in financing LNG projects
  
  Maximise your learning experience by signing on to a Diploma Programme for our Gold Level Natural Gas courses.
  Click herefor further information.
  
  Suitability:
  
  
  
  • Commercial and technical personnel with at least two years experience of international pipeline natural gas sales agreements who wish to extend their knowledge to LNG agreements
    
  • Personnel from government, regulatory and fiscal authorities who wish to widen their knowledge of contractual and commercial issues in LNG
    
  • Personnel with substantial experience in the natural gas industry
    
  • Delegates who have previously attended the NG5 course - International Gas Contracts - Commercial Factors and Negotiations - and wish to extend their knowledge to LNG agreements
    
  
  Some Commercial Aspects and Contractual Issues
  
  
  
  • Types of and reasons for F.O.B., ex-ship and other contracts
    
  • Financing LNG projects and role of gas sales and purchase agreement
    
  • Gas specification issues arising within sellers' operations and between buyers and sellers
    
  • Gas specification issues at offloading destination
    
  • Metering and consideration of "boil off" gas
    
  • Destination and re-export considerations
    
  
  Role of the Gas Sales Contract in the LNG Chain
  
  
  
  • Outlining the relationship between buyer(s) and seller(s)
    
  • Reconciling the differing demands of buyers and sellers
    
  • Balancing risks and rewards
    
  • Resolving disputes
    
  
  Some Elements of an LNG Sales and Purchase Agreement
  
  
  
  • The parties and place of incorporation
    
  • Recital
    
  • Contract terminology and definitions of terms used
    
  • Applicable law
    
  • Dispute resolution, arbitration, Force Majeure
    
  • Initial supply period
    
  • Annual delivery programme
    
  • Seller's obligations. Buyers' obligations
    
  • Transfer of title, custody and risk
    
  • Quantities
    
  • Measurement, sampling and analysis
    
  • Compatibility and specifications of LNG vessels
    
  • Loading and unloading procedures
    
  • Pricing provisions
    
  • Invoicing, payment and taxes
    
  • Waivers
    
  • Grounds for termination
    
  
  Note: Matters such as Take-or-Pay, Make Up, Carry Forward gas etc will be covered briefly but only in an LNG context since they are covered in more detail on the NG5 Gas Contracts course. Similarly, the elements mentioned above will be treated specifically within an LNG and not general contractual context. Additional clauses will also be included.