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Origin of products: Kazakhstan. Supplier: direct Kazakhstan Refinery
ULSD 10 ppm EN590 monthly quantities: 20,000 to 300,000 MT
Jet A1 monthly quantities: 500,000 to 3,000,000 Bbls
Light Cycle Oil monthly quantities: 20,000 to 300,000 MT
LNG monthly quantities: 20,000 to 300,000 MT
1. Once Buyer’s agreement with this current Transaction Procedure is confirmed, a preliminary NCNDA is established and Buyer issues ICPO containing the Seller’s working procedure, CIS or detailed Corporate Profile, photo page passport copy and Certificate of Incorporation to Seller.
2. Seller issues the Sales & Purchase Agreement (SPA) draft Contract for the Buyer’s review; the draft Contract must be duly endorsed and returned by the Buyer with a Letter of Undertaken to perform obligations under the Contract.
3. Seller approves the signed Sales & Purchase Agreement (SPA) draft Contract, for official notarization with the relevant government ministries. After which, Seller issues the partial proof of product and other documents as follows:
a) Pro forma Commercial Invoice as confirmed and approved by Buyer
b) Statement of product availability
c) Allocation Letter/Refinery Commitment
d) Sample of the Fully Funded SBLC (STANDBY LETTER OF CREDIT MT 760) or BG (BANK GUARANTEE MT 760) to be issued by Buyer, accepted and approved by Buyer’s Bank
e) ICC Warning Letter
f) Final NCNDA/IMFPA
4. The Buyer’s Bank, within 72 (Seventy-Two) hours, issues the pre-advice (RWA) in the form of MT799/MT760 via SWIFT to the Refinery nominated fiduciary Bank with the agreed wordings and texts. The text of the BG/SBLC to follow should state the validity for 12 months in the amount of the average monthly deliveries, with the price calculated according to agreed discount from the date of issuance of the Commercial Invoice. After the acceptance of the wordings, texts and formats, within 7 (Seven) banking days the Buyer Bank issues BG/SBLC in the form of MT760 via SWIFT to the refinery nominated fiduciary Bank.
5. In a situation where the Buyer is not able to issue a BANK GUARANTEE (BG) / STANDBY LETTER OF CREDIT (SBLC) within 7 days, Buyer would make a provisional payment of USD $185,000 by MT 103/ T/T Wire transfer to enable Seller to conduct allocation and loading of the product in accordance with the shipping and delivery schedule. It is important to note that Buyer is mandatorily required to either issue a BANK GUARANTEE (BG) / STANDBY LETTER OF CREDIT (SBLC) or issue a provisional payment of USD $185,000 via wire transfer to Seller before the process of loading the product into the Vessel, and subsequent sailing of the Vessel to Buyer’s discharge port. The Contract would be unilaterally cancelled in the event that Buyer fails to perform its contractual obligations as defined herein.
6. Upon Buyer’s compliance and fulfilment of contractual obligation in accordance with the terms and conditions of the signed Sales & Purchase Agreement (SPA), Seller shall commence and complete loading of the product and shipment arrangements within 14 to 21 days after compliance, and confirmation of Buyer’s BG / SBLC at Seller’s fiduciary Bank, after which Seller shall send the full shipping documents to Buyer via registered courier mail prior to departure of vessel to the Buyer’s designated discharge port.
The documents are:
a) Copy of the beneficiary’s unpaid final Commercial Invoice, duly signed
b) Certificate of Quality and Quantity issued by SGS, Intertek, Saybolt or equivalent
c) Full set of Bill of Lading (3 original copies)
d) Vessel Notice of Readiness (NOR)
e) Marine Insurance Certificate
f) Ullage report
g) Cargo Manifest
h) Vessel Q88
i) Certificate of Origin
j) IMO registration information
7. Within 21-30 days, upon arrival of the product at Buyer’s destination port, the Buyer conducts Inspection of the product by SGS or similar at Buyer expense, and Buyer transfers the outstanding payment MT103 for the Seller’s Commercial Invoice and with respect to the Q/Q Reports issued at the port of loading and shipment. Seller transfers title and ownership documents to the Buyer.
8. Seller pays commission to intermediaries as per IMFPA having received the full payment for the product within three (3) banking days.
————————————————– End of Transaction Procedure——————————————–
IMPORTANT NOTES:
Seller can deliver:
• JET A1 at fixed prices currently equivalent to an average discount to Platts between 15% and 20%; ULSD 10 ppm EN590, Light Cycle Oil and LNG at fixed prices currently equivalent to an average discount between 20% and 30%.
• Final Price is provided to a confirmed Buyer and will depend on product, delivery port, quantity and specifications.
• The standard template for the ICPO to be issued on the Buyer’s letterhead is attached as Annex 1. Following a preliminary NCNDA, Vox will pre-fill and send the ICPO template to the Buyer side with the filled information pertaining to the specific transaction.
• Once documentation mentioned in Paragraph 1 is provided and reviewed by Seller, a conference call may be established if required, between the End Buyer and the direct Seller. Intermediary parties can attend this call.
• Seller will do only 12 months Contract (No spot deals).
• Consultancy fees for Seller side and Buyer side intermediaries are included in the price paid by Buyer and are transferred by Seller to the intermediary parties. Seller side of consultancy fees is closed and includes the Vox team and other seller side parties. Available consultancy fees are to $1 per barrel for Jet A1 and $5 per MT for EN590, LCO and LNG, fully open for sharing among the buyer side intermediaries.
ANNEX 1
ICPO TEMPLATE
ON BUYERS’ LETTERHEAD
DATE:
TO: (Seller Rep)
CC: ops@vox-oil.com – Seller representative/Referring Broker
CC: xxxxxxx – Referring Broker
CC: xxxxxxx. – Referring Broker
FROM: (Buyer)
Irrevocable Corporate Purchase Order
(or Letter of Interest to Purchase)
(BUYER) is domiciled in (COUNTRY) operating in good standing with our Government. We confirm that
(BUYER COMPANY) are ready, willing and able to purchase the following commodities;
1. BUYER: xxxx
2. COMMODITY: xxxx
3. CARGO ORIGIN: (Any OR Non-sanctioned OR Specific country)
4. QUANTITY: xxxx MT/Bbls trial shipment and xxxx MT/Bbls per Month for 12 Months
5. TARGET PRICE: Equivalent to xx% discount to the applicable Platts
6. TOTAL BROKER FEES: $xxxx per Metric Ton/Bbl, included in the price and agreed upon, accepted by Buyer
7. DELIVERY PORT: xxxx
8. RECEIVING TERMINAL: (Name of receiving tank farm/terminal at the delivery port)
9. SPECIFICATIONS: ATTACHED Requested Specs Sheet
10. PAYMENT TERMS: Bank Wire After Delivery
11. TOP 100 BUYER’S BANK: xxxx
BUYER’S NAME/COMPANY:
REPRESENTED BY/POSITION:
ADDRESS:
EMAIL ADDRESS, TELEPHONE:
(TEXT OF THE TRANSACTION PROCEDURE)