By OGJ editors
HOUSTON, Sept. 25 -- Publication of a new model form master LNG sale and purchase agreement by the nonprofit Association of International Petroleum Negotiators aims at creation of a secondary market for LNG that will “facilitate trading and arbitrage of LNG cargoes.”
The agreement form helps the industry establish a “uniform short-term and spot sales agreement,…thereby reducing transaction time, cost, and uncertainty,” said the announcement.
Publication concludes an effort to “create a model contract that balances the interests of sellers and buyers, is geographically neutral, and contains all of the provisions that most parties will require” in a master LNG sale and purchase agreement. It includes alternatives and options as well as guidance notes for users.
The move caps 3 years of effort by AIPN’s drafting committee that consisted of more than 150 industry representatives, including members from many of the major LNG sellers, buyers, transporters, and traders worldwide, according to the announcement of the association’s board of directors. The committee, cochaired by Steven Miles of Baker Botts LLP, Houston, and Harry W. Sullivan Jr., ConocoPhillips, Houston, held more than 15 meetings and five workshops in seven countries on five continents.
According to the association, this form is the latest in a “series of hydrocarbon-related model contracts” it has published to “facilitate the negotiation of energy transactions around the globe.”
Founded in 1981, AIPN has 2,600 members in more than 80 countries, representing international oil and gas companies, governments, law firms, multilateral organizations, and academic institutions.