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FAQs on transaction reporting – Question II.3.1.22

Contracts for the supply of LNG at the flange of an LNG regasification terminal should not be reported unless there is an obligation to deliver to at least one EU LNG regasification terminal.  In case of contracts with flexible delivery location including non EU destinations, this obligation arises only when a commitment is made to deliver a cargo at an EU LNG regasification terminal.

Once a cargo is confirmed to be delivered at an EU LNG regasification terminal, the transaction and commercial details relating to the cargo delivery can be reported using table 2 and after delivery, an “execution” via table 1 will be reported.  Such reporting would apply to each cargo under “multi cargo or single cargo deliveries” contracts.

For multi cargo deliveries where all terms are similar for every cargo (e.g. price, delivery location, etc), the Market Participant could take a more efficient approach and ignore the “per cargo” approach. It could report the transaction and commercial details via a single table 2 and the aggregated volume and price of executions once known via table 1.

Please see examples in Annex I.


Answer:

The Agency has discussed the following scenarios with its stakeholders. In the Agency’s view the following scenarios may occur:

Scenario 1: Single cargo supply contract agreement is made on the day the contract is signed (10th April 2016) that delivery will be at an EU LNG terminal. Delivery is due on 1st June. Cargo is made on 1st June and volume is 99% of estimated total.

This should be reported with: Table 2 for Non-standard contracts within 1 month from the day the delivery into the EU was agreed + Table 1 for the EXECUTION (delivery) within 1 month from the when price and volume are known.

Scenario 2: Single cargo supply contract, originally agreed to deliver to a Non-EU LNG terminal on the day the contract is signed, (April 10th 2016) but at a later date (May 12th 2016) the delivery optionality is exercised and parties agree  to deliver to an EU LNG terminal . Delivery is due on 1st August. Delivery is made on 1st August and is 98% of estimated total.

This should be reported with: Table 2 for Non-standard contracts, within 1 month from the day the delivery into the EU was agreed + Table 1 for the EXECUTION (delivery) within 1 month from the when price and volume are known.

Scenario 3: Multi cargo supply contract and buyer has the option to choose where delivery is made globally depending on commercial preference at the time. Signed on 10th April 2016- agreed to deliver 10 cargos (each cargo 3million mmbtu) over 3 years to any LNG terminals in the world. On 7th September 2016, the parties agree to deliver one of the cargos to an EU LNG terminal. Delivery is due 1st December 2016. Delivery is made on 1st and 2nd December and is 102% of the estimated total.

This should be reported with: Table 2 for Non-standard contracts for the cargo, within 1 month from the day the delivery into the EU was agreed + Table 1 for the EXECUTION (delivery) within 1 month from the when price and volume are known. Any subsequent delivery / cargo delivered into the EU will be reported similarly.

Scenario 4. Single cargo supply contract, originally agreed to deliver to an EU LNG terminal on the day the contract is signed, (April 10th 2016) but at a later date (May 12th 2016) the delivery optionality is exercised and parties agree to deliver to a non-EU LNG terminal  instead.

This should be reported with: Table 2 for Non-standard contracts within 1 month from the day the delivery into the EU was agreed + Lifecycle event (Cancel) once the commercial agreement has been made to deliver to a non-EU location within 1 month from the day it was agreed to deliver the cargo to a non-EU LNG terminal.

Scenario 5: Multi cargo supply contract signed on 10th April 2016- agreed to deliver 10 cargos (each cargo 3million mmbtu) over 3 years, all with the same volume, price and delivery location which is an EU LNG terminal. First delivery is due 1st May. Delivery is made on 1st May and volume is 101% of estimated total.

This should be reported with: Table 2 for Non-standard contracts within 1 month from the day the delivery into the EU was agreed + Table 1 for the EXECUTION (delivery) per cargo, within 1 month from when price and volume are known.

Scenario 6: Spot in tank transfer Agreed to deliver gas in tank at an EU LNG terminal – fixed quantity of gas with spot delivery, at a fixed price. Contract is signed on 1st October for delivery on 2nd October.

This should be reported with: Table 1 for Non-Standard BILCONTRACT contracts with outright price and volume for the contract (as per normal pipeline gas supply contracts with outright price and volume) within 1 month from the when price and volume are known.

Scenario 7: Term in tank transfer. Agreed to deliver gas in tank at an EU LNG terminal – variable quantity over a 3 month delivery, with a formula based price. Contract signed 1st May and first months deliveries occur daily over May, June, July.

This should be reported with: Table 2 for Non-standard contracts within 1 month from the day the delivery at EU LNG terminal was agreed + Table 1 for the EXECUTION (delivery) per invoicing cycle period (i.e.  monthly as per normal non-standard pipeline gas supply contracts) within 1 month from the when price and volume are known

Any contracts that were outstanding on 7 April 2016 should be reported as back loading, same as for any other contract for the supply of gas or electricity.

Last update: 14/12/2016   RSS_Icon Subscribe to this Page’s RSS