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This article was published in March 2015. FOB agreements, a seller is required to deliver goods
It is the third in a series of articles exploring issues by means of a vessel designated by the buyer. The
associated with changing oil prices. (See the first seller fulfills its obligation when the goods have pas-
two articles, “Lower, and More Volatile, Oil Prices: sed over the ship’s rail. JCC (Japan customs cleared)
What They Mean and How to Respond,” January is the average price of customs-cleared crude-oil im-
2015; and “Killing the Complexity Monster in E&P: ports into Japan. Under DES (delivered ex ship) agre-
Eight Critical Actions for Upstream Oil and Gas ements, the seller is required to deliver goods to the
Companies,” January 2015.) buyer at an agreed port of arrival. The seller remains
responsible for the goods until they are delivered.
The authors would like to thank Juan Vázquez for
his contributions to this article. (2) If oil prices were to remain low for an extended pe-
riod, though, it’s possible that a reduction in natural-
(1) The FOB cost of LNG exports from the U.S. East gas supply could push Henry Hub prices higher, which
Coast stands at approximately 115% of Henry Hub could offset the impact of falling NGL prices on energy
prices plus $3 per MMBtu of liquefaction. Asian LNG companies’ finances. Henry Hub prices could rise by
import prices stand at about 14% of JCC DES. Under as much as $1 per MMBtu, depending on the indust-
ry’s ability to reduce the cost of new developments.

Iván Martén

Iván is a Senior Partner and Managing Director of The Boston Consulting Group. He is the Global Leader
of the Energy Practice Area

Daniel Jiménez

Daniel is a Principal in BCG and core member of BCG Energy Practice Area, specialized in oil & gas. He
has managed projects in the oil & gas sector in Europe, Middle East and Latin America

34 Impiantistica Italiana - Maggio-Giugno 2015