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Managing LNG Freight Risk Using Futures

5th February 2020 @ 9:00 am - 1:00 pm

This half day classroom style course is aimed at commercial and risk executives in the LNG market as well as ship operators and ship finance professionals. The course is also suitable for shipbrokers and financiers wishing to expand their knowledge of their clients’ business.

Participants will learn how an LNG Forward Freight Agreement (FFA) works, how it can be traded and used to effectively manage pricing risk from volatility in freight rates of the LNG shipping markets.

This is a highly relevant course for a broad spectrum of participants all over the world, and is aimed to help build confidence in using new indices from the Baltic Exchange in managing risk for shipping.

Syllabus

The Baltic BLNG Index:  

– Comprehensive understanding of the BLNG Baltic Index and Index methodology  
– The role of panels and integrity of the market  
– Pricing of the Index on time charter and voyage charter  
– Calculating ‘Basis Risk’ between the LNG Index and main LNG trading routes
– Index Settlement mechanisms and correlations  
– Term structure of the LNG forward curve 
– Contango, backwardation, inversions and seasonality  

Putting it all together with FFAs: 
 

– Composition, construction and use of an LNG FFA derivatives contract  
– Practical application of LNG FFAs to freight contracts and time charters  
– Calculating pricing risk, calendar risk and cash flow  
– Settlement mechanisms  
– Leverage and Margining and mark-to-market 
– Stress testing  
– Examples and practical uses of an LNG FFA contract 

 

Course leader

Mikal Bøe

Mikal is a senior executive with 28 years’ experience in shipping, technology and commodities; with particular focus on risk management.

Prior to starting CORE-POWER in 2016, Mikal served as Chief Risk Officer and Director in charge of Singapore office for Thoresen Thai Agencies (BKK:TTA) an Asian industrial group stock listed in Thailand. He previously served as Chief Risk Officer for Eagle Bulk Shipping (NASDAQ:EGLE)in Singapore and New York; and spent many years at IMAREX, the first regulated marketplace for freight derivatives.

Several unique new businesses were started by Mikal, including bunkerworld.com (1997) sold to S&P Platts in 2013, Cleartrade Exchange, now part of the EEX and owned by Deutsche Boerse and CORE-POWER – established to spearhead the development of a commercial market for the ‘Liquid Fluoride Thorium Reactor’ in transport and industry.

Cost 

USD 600 / SGD 800

 

Bookings

Please contact Shena Cheng. Email: scheng@navigatepr.com

Details

Date:
5th February 2020
Time:
9:00 am - 1:00 pm
Event Category:

Venue

SGX Auditorium
2 Shenton Way
Singapore, Singapore
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