LNG Trading Strategies

LNG TRADING STRATEGIES 

Current Issues in LNG Trading Optimisation, Risk Managment and Market Development

June 2, 2010 ~ London

08:30  Registration and Coffee

09:00  Chairman's Welcoming Remarks

09:10  Overview of Current Issues in the Global LNG Markets

• Current production outlook
• Availability of import infrastructure: current and future projects
• Regional demand: Arbitrage Models
• New market entrants: on the way to greater liquidity?
• LNG supply and demand balance
• Future production projects

09:50 Overview of LNG Markets

• Relationship between natural gas and LNG
• LNG value chain
• LNG Trade flows and competition among markets
• LNG pricing: Contract structures, spot price and netbacks
• Players and market trends

10:20 Changing Dynamics of LNG Trading

• How will increased liquidity impact LNG trading patterns?
• Changing patterns in the US demand?
• Sustainability of S-Curve model: Will Far East move to oil parity pricing?
• New regional markets: An impact on pricing
• JCC, naphtha and role of other competitive fuels in LNG pricing
• Changes in the traditional arbitrage models: Henry Hub, NBP and the Far East
• Cross-correlation between natural gas, oil, power and coal markets

11:00 Morning Coffee

11:00 Risk Management in LNG Trading

• Risk quantification and identification
• Currency risk, technological risk and pricing
• Recent advances in risk management strategies
• Demand impact on trading
• Typical trading strategies and their associated risk
• The forward value: backwardation and contango
• Counter-party risk

11:40 Forward hedging strategies with LNG

• Return optimisation: minimising risk
• Overview of hedging strategies and efficiency
• Spot price risk and liquidity risk
• Roll-over hedge
• Optimal hedge ratio and hedging efficiency
• Hedging with futures, forwards and swaps  

12:20 Issues in LNG Shipping

• Overview of current fleet capability
• Overview of vessel design and technological advancements
• Regional dynamics of LNG trading and emergence of new markets:
• China, Thailand and Singapore
• New seasonal markets: Kuwait and India
• Mediterranean Basin
• Will the existing tonnage have the ability to cover trade demands?
• Current and future trends in charter rates
• Floating LNG storage and regasification terminals

13:00 Lunch

14:30 Impact of Unconventional Gas on LNG

• The impact of unconventional gas on the US markets
• Unconventional gas and its impact on LNG demand
• Will shale gas act as a long-term price moderator?
• Economics of long-term investment in US receiving terminals

15:10 Arbitrage, Storage and Trading

• The role of storage operators in the US and Europe
• Role of cargo diversions in the US: Exploring the re-export option
• Impact of diversion from Europe: Re-export option
• Possibility of small-scale LNG trading: From re-export to end-user
• Atlantic basin price arbitrage potential provided by destination flexibility
• The Middle East as source of arbitrage between Atlantic and Pacific markets

15:50 Baseload LNG: Markets and Dynamics

• LNG quality and interchangeability: lean vs. rich
• When can we expect to see greater interchangeability levels?
• Proportionality of produced volumes in relationship to existing and future terminals
• Are we moving toward demand destruction?
• Technological innovation and reaching new supply markets

16:30 Coffee Break 

17:00 PANEL DISCUSSION: Changes in LNG contracts and pricing?

• Pricing in contract dependent markets: Pipelines and LNG
• Gas market liberalisation and its impact on pricing
• Potential sources of competition for contract dependent markets
• Current pricing trends in the Atlantic and Pacific basin: US, UK, Continental Europe, India and the Far East
• Impact of new production projects in Asia: Russia and Indonesia

18:00 Chairman's Closing Remarks

18:10 End of Conference