Overview of the LNG Value Chain (CLASSROOM) - LNG1
Course Schedule
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**Please register by the deadline to help us ensure sufficient attendance and avoid postponing the course.
Course Summary
This course provides a comprehensive overview of the LNG value chain from upstream supply, liquefaction, shipping and regasification of LNG into downstream markets. The course is designed for new entrants to the LNG business or for those with some knowledge of the business wishing to broaden their understanding of the complete value chain. Those without prior knowledge of the LNG business may wish to familiarise themselves through the pre-study web based course.
After learning the fundamentals about LNG, the course covers the liquefaction process and LNG plants, shipping and regasification terminals with a focus on what happens along the value chain. This is followed by an understanding of the commercial issues affecting LNG projects, the players and the various drivers affecting the development of LNG projects. Key aspects such as project development, timescales and the range of Agreements and their integration will be covered. The course then moves on to the global LNG supply sources, markets and trading and the factors affecting the growth of the LNG business.
Includes Online Pre-study Module
This course is accompanied by a preparatory course available online. Delegates will receive a web voucher as part of their joining instructions upon confirmation of registration. By taking advantage of this "blended" learning approach, in-class time and learning are optimized.
What Will You Learn?
- What is involved in developing an LNG project
- The LNG value chain and the investments required
- The processes involved in gas treatment and liquefaction
- The importance of gas quality and upstream supply issues
- Impact of economies of scale
- The specialised nature of LNG ships
- How shipping fits in the value chain
- How a regasification terminal operates
- Who the key players are and their drivers
- How an LNG project is developed
- Commercial issues impacting LNG projects
- The main Agreements in an LNG project and how they are structured
- The economic value of an LNG project
- A global view of LNG supplies by region
- How LNG competes in the energy market
- Where the key LNG markets are and their characteristics
- How LNG trading works
- The differences between trading oil and LNG
- How LNG is priced and regional differences
Who Should Attend?
New entrants to the LNG industry
Managers in specific areas of the LNG chain requiring a broader knowledge of the commercial issues affecting the business
Professional personnel interacting with LNG supplies, markets and trading e.g. finance, legal marketing and those who need to understand the various sectors of the value chain and how they interact
Course Content
What is LNG?
- Terminology
- LNG Properties
- Units and conversion factors
- Why LNG
- Structure of the LNG industry
Liquefaction
- Basic principles of refrigeration
- LNG liquefaction processes
- Importance of gas quality
- Comparison of process technologies
- Project costs
- New developments
LNG Plants
- Where are they?
- LNG milestones
- Growth and size of the industry
- Overview of global supply sources
LNG Shipping
- Cost comparison versus pipeline
- Special nature of LNG tankers
- Ship technologies
- Shipping costs
- Shipping capacity and delivery capabilities
- Shipping market
- Implications for LNG trading
LNG Regasification
- Processes involved
- Terminal operations
- Offshore regasification
- Constraints to developing terminals
- Regional overview of terminals
Commercial considerations in developing LNG projects How does LNG compete?
- What are the alternatives to LNG?
- Relative advantages and disadvantages of LNG
- Market value versus other fuels
Who are the players?
- Players in the value chain
- Governments
- Oil majors
- National Oil Companies
- Independents
- Shipping providers
- Buyers
- Terminal operators
- Finance providers
- Traders
- Local stakeholders
- Environmental Organisations
- Regulators
- Drivers, Influence and concerns for each player
Commercial Structure of an LNG Project
- Developing an LNG project
- Alternative Commercial Structures
- LNG Contract chain Contractual arrangements and timing
- Complexity of integrating requirements
- Overview of the Agreements
Main Agreements in an LNG project
- Contractual terminology
- Monetising the Upstream
- Upstream Agreements
- Joint Venture Agreements
- Monetising the midstream
- LNG Supply purchase Agreements
- Shipping contracts
- Import terminal arrangements
- LNG financing arrangements
LNG Project profitability
- Project life cycle
- Need for long term cash flow
- Project economics
- Risk analysis
- Value splits in an LNG Project
LNG Supplies, Markets and Trading LNG Supplies - where will it come from?
- Global overview
- Regional supplies from existing markets
- Potential new projects
- Country profiles
- Key success factors
- Constraints on new project developments
LNG Markets - where will it go?
- Overview of Natural gas consumption
- Growing importance of LNG
- Overview of regional markets
- Country profiles for the main importers
LNG Trade
- Historical trade flows
- Current trading routes
- Major players
- Requirements for portfolio trading
- Constraints on LNG trading
- Types of trade (long term versus short term)
- Impact of regulations
- Diversions/swaps and arbitrage
LNG Pricing
- LNG pricing basis/principles
- Market based pricing (impact of pricing formulae)
- Natural gas pricing
- Price Reviews
- Impact of trading on LNG/natural gas pricing
LNG - The Future
- Growth potential
- Globalisation
- New technologies
- New frontiers
- New players Trading and commoditisation
- Constraints on new project developments
Exercises and Case Studies will include:
- LNG contracts
- Roles of players
- Shipping requirements
- LNG Quality
- Netback Analysis
