LNG Financing and Commercial Management

Introduction:

This training course is designed to help managers and professionals to expand their business knowledge and stay top of LNG business dynamics.

Through this course we aim to highlight the wide array of LNG business features from beginning to the end. LNG’s use as an energy source is expected to grow substantially in the future because it can help achieve two important energy goals for the twenty-first century— providing the sustainable energy supplies and services needed for social and economic development and reducing adverse impacts on global climate and the environment in general.

Objectives:

By the end of this training course, participants will be able to:

• Gain better understanding of the dynamics of the entire LNG value chain
• Understand LNG production, storage, transportation and distribution
• Understand the LNG Pricing Issues, Structures, for exports
• Distinguish various sales, marketing terms and conditions
• Understand the various terms in LPG sales and purchase agreements
• Learn economic evaluation benchmarks and determine return on investments

Targeted Groups:

• Business Development Managers
• Corporate Planning Professionals
• Geoscience & Engineering Professionals
• Supply Planners & Scheduling Professionals
• Government Regulators
• Tax & Finance Advisors
• Auditing Personnel 
• Compliance Officers
• Equity Analyst and Bankers
• Joint Venture Officers
• Negotiators and Contracting Professionals

Course Outline:

Unit 1: Setting the Introductory LNG Scene in Energy Industry   

• Introduction to the LNG Industry
• Exploration, Development and LNG Production, Shipping, Importation
• Cost and Value Drivers: Shareholder Expectations
• The Value Chain: From Wellhead to Burner Tip
• Players: Governments, NOCs, IOCs, Banks and Insurers, etc.
• Natural Gas Value Chain
• Exploration and Production
• Processing and Production
• Sales Gas Transmission
• Underground Storage
• Distribution
• Sales Gas and Product Specifications
• Global Production
• Where and Who are the Producers of LNG
• Projects currently under Development
• Where and Who are the users of LNG
• Projects currently under Development
• Gas Conditioning Processes
• Excess Water Removal
• Contaminants Removal
• NGL Separation

Unit 2: Essential Logistics of LNG

• Nitrogen Rejection Processes
• Cryogenic Process
• Absorption Process (using lean oil or solvent) Membrane Separation
• Adsorption Process (activated carbon) Storage System
• LNG Transportation Logistics
• Vapour Recovery System LACT Unit
• Sampling
• Natural Gas Transportation
• Pipeline Components
• Compressor Stations
• Metering Stations
• Valves
• Control Stations
• Pipeline Operations
• Basics of Gas Pipeline
• Gas Flow Measurement
• Liquefied Natural Gas (LNG)
• Why LNG a Growth Industry
• Compression & Refrigeration
• Transportation of LNG
• Major LNG Exporting Nations
• Major Importing Nations  

Unit 3: LNG Pricing Structures for Exports, Marketing and Project Risks

• LNG Sales, Marketing and Trade
• Price Disparity in Different Regions
• LNG Benchmarks
• Major Changes in LNG Business
• LNG Pricing Structures and Price Dynamics
• Natural Gas Prices
• Regional Pricing Disparity
• Pricing Structures Key to Future of LNG Exports
• Oil Linked LNG Pricing
• Business Sector
• Industry and Market Structure
• Natural Gas Demand
• Natural Gas Supply
• Economics of the Natural Gas Plants
• LNG Expanding Market
• LNG as Land Transport Fuel
• LNG as Marine Transport Fuel
• Key Project Risk and Value Identification
• Understanding the Fundamental Commercial Drivers for Project Success
• Identification of Key Project Risks (from a commercial perspective) and Mitigation Strategies
• Reserves Definitions and Reserves Certification
• Completion and Cost Overrun Risks
• Cost Linkages to Oil and Gas Prices
• Maximizing Profitability of Gas Plant Assets
• Business Evaluation and Profitability Analysis
• Return on Investment Analysis
• Selection Criteria of Best Return on Investment
• Portfolio Management
• The Performance Strategy— Integrated Gas Plant
• The Successful Information Strategy
• Operations Strategy

Unit 4: LNG Project Financing and Project Management 

• Gas Plant Project Management
• Project Management Overview
• Industry Perspective
• The Project Management Process
• Project Controls & Quality Controls
• Quality Assurance
• Commissioning and Start-up
• Dispute Prevention & Arbitration
• Disputes
• Arbitration and Expert Determination
• Commercial Structures
• Alternative Commercial Structures
• Complexity of Integrating Requirements
• FOB vs. DES Sales
• LNG Project Financing Essentials
• Financial Structures in LNG
• Investment Decision Making
• The Key Value Drivers in LNG Financing
• Overview of LNG Financing Options
• Balance Financing
• ECA and Multilateral Agency Funding
• Capital Markets
• Asset based Financing
• Project Financing and Structured Recourse Financing

Unit 5: LNG Agreements, Regulations and Future Trends

• LNG Agreements
• Overview of the Contractual Terminology
• Stakeholder Analysis and Drivers
• Upstream Agreements
• LNG Supply Purchase Agreements SPA
• EPC Contracts
• LNG Shipping Arrangements / Agreements
• LNG Regasification Terminal Agreements
• Fiscal and Legal Regimes Worldwide
• Production sharing Arrangements
• Regulations
• The History of Regulations
• The Market under Regulation
• The Environmental Impact
• The Future Trends in Natural Gas Trends
• Trends in LNG Markets
• Latest Changes and Movements in LNG Trading
• The Impact of Shale Gas
• Hubs vs. Oil for Price Setting
• Market Shifts in Importation and Liquefaction
• Mid and Small-Scale LNG
• Benefits of Floating LNG Business

Unit 6: Upstream Fiscal & License Agreements

• Upstream Joint Venture Agreements
• LNG Project Structures
• Gas Sales to an LNG Plant

Unit7: Key LNG Sales Agreements

• The Essence of the LNG Markets
• The Essence of the LNG Sales Contract
• Price in the LNG Sales Contract
• Master Sales Agreement
• Key LNG Transportation Agreements and Value Creation
• Shipping Requirements
• Flexibility and Value Creation in LNG Transportation

Unit 8: Key LNG Regasification Agreements, Management and Operations

• The Latest Developments in LNG Import Terminals
• Terminal Use Agreement
• Scheduling and Operations
• LNG Access to Gas Transmission Networks, Quality Issues and the Final Market
• Transmission
• Quality
• Power Market Evaluation
• Negotiating Access and Tariffs at a Regasification Terminal
• Effective Risk Management: Commercial, Technical and Project Risk Matrix
• Key Project Risk and Value Identification
• Handling Risks
• Disputes

Unit 9: Financing LNG Projects

• LNG Project Financing Essentials
• Overview of LNG Financing Options