LNG Markets, Pricing and Hedging

Introduction

Environmental pressure and the race to mitigate the effects of climate change have propelled the use of natural gas to the forefront of the available options for reducing our dependence on fossil fuels. Natural gas although a fossil fuel itself, actually reduces the worlds carbon footprint and is considered as an intermediate step until renewable sources of energy become competitive.

LNG Markets, Pricing and Hedging examines the dynamics of the LNG market which is currently undergoing changes with more and more spot and short term trading, new players in the form of trading houses, new price benchmarks being introduced and new financial instruments like futures and swaps become available for managing price risks.

Presently the oversupplied LNG market is, a result of rising supply from relatively new exporting facilities mainly from the U.S. and Australia.  The rising demand in Asia, has failed to keep up with the rising supply and LNG prices have sunk. The result is that the main buyers from leading importing countries are moving away from a single supplier on long term oil indexed contracts, to a much more flexible procurement portfolio with short term and spot contracts. For a futures contract the main requirements are a well-functioning underling cash market and enough potential buyers and sellers to create enough liquidity therefore the Brent and Henry Hub Natural gas futures being highly liquid could therefore be used as a solid hedging instruments.

This training course will highlight:

• LNG Market fundamentals analysis
• LNG Pricing methods
• LNG projects' economic evaluation
• LNG supply, trading & hedging strategies
• Natural gas and LNG markets
• Understand regional LNG pricing effects
• Learn what LNG derivatives are and how these are used for hedging and trading purposes

Objectives

LNG Markets, Pricing and Hedging training course aims to help delegates from the gas industry achieve the following objectives:

• Develop essential skills of how the LNG, industry functions
• Understand the business drivers behind the LNG sector
• Acquire knowledge about the different types of contracts that may be used in Gas and LNG operations
• Assess the contractual risks that may appear in Gas and LNG contracts, and learn how to manage those risks
• Understand LNG and Gas contracts
• Comprehend gas market developments

Training Methodology

A full range of dynamic and interactive training methods, including exercises, case studies, question and answer sessions and discussion groups. Each topic will be underpinned by a PowerPoint presentation that highlights key issues. The learning experience will be supported by training materials containing reference examples.

Participants to this training course will receive a thorough training on the subjects covered by the seminar outline with the Tutor utilising a variety of proven adult learning teaching and facilitation techniques.

Organisational Impact

• Current LNG market sector analysis
• Insight into current market trends
• Energy strategy and natural gas
• LNG Project Financing and Project Management
• LNG Pricing methods: Price Slopes, Maximum Available Netback Prices, Proxy Curves, etc.
• LNG derivatives for hedging and risk mitigation
• Increase in basic technical and commercial knowledge
• An appreciation of the competitive nature of the LNG market segment

Personal Impact

• Understanding of the complex global natural gas market
• Ability to share latest LNG market knowledge
• State of the art information related to this business
• Potential to pass on this information to co-workers
• Networking with delegates from similar background