Oxford Energy Podcast – LNG Portfolio Optimization: Challenge, Opportunity and Necessity.
A key element of LNG trading, the buying and selling of LNG cargoes (or strips of cargoes) on shorter term contracts of less than three years duration, is cargo optimization. LNG traders, once they have secured positions in the LNG chain, seek to ‘optimize’ their LNG position or ‘LNG book’. This optimization process is often seen, or referred to, as a ‘black box’ with companies using their portfolio of supply and sales contracts, together with shipping capacity, to maximise returns through optimizing their flows of LNG. In this podcast David Ledesma discusses with Mashal Jaffery and Peter Thompson of Baringa Partners the optimization ‘black box’, why such optimization is important to today’s LNG business model and how companies can carry it out and what approaches can be taken.