American Conference Institute's Natural Gas Supply Contracts

Stroock partner Scott Le Bouef will be a panelist at the American Conference Institute's Natural Gas Supply Contracts program on January 25 ,2012 in Houston, TX.

Mr. Le Bouef 's panel, "Understanding and Operating Under the Dodd-Frank Regulatory Structure and its Impact on Gas Supply Agreements," will discuss the following:

Dodd-Frank Implications on Natural Gas Marketing

  • Avoiding non-compliance and mitigating enforcement risk by determining what contracts will be considered swaps
    • Defining how CFTC is interpreting swaps
      • Inclusion of options
    • What is a bona fide hedge as defined by CFTC?
    • Will hedging be cost prohibitive?
      • Physical supply cannot be used as collateral for the hedge
  • How does the Dodd-Frank regulation of swaps affect long-term purchase price?
    • Does Dodd-Frank affect the ability to enter into long-term deals?
  • Reconciling CFTC’s requirements that swaps be traded on an exchange with the CFTC’s lack of definitions of “swap” and “swap dealer”
    • Classifications: end user vs. swap dealer vs. major swap participant
  • Understanding the importance of identifying the category of counterparties
  • Complex vs. vanilla deals: Avoiding enforcement risks by properly determining whether a deal must be traded on an exchange
Managing Structured Agreements Categorized as Swaps under Dodd-Frank
  • Maintaining compliance when margining swaps
  • Applying the futures method to swaps and options
  • What does it mean to have built in optionality when a physical deal has financial aspects?
  • Meeting capital sufficiency requirements
    • Identifying financial structuring alternative to using gas as collateral to hedge
  • Complying with reporting requirements for trading swaps and options
  • Determining what end users will do if it becomes more expensive to buy swaps

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