Commodities, Trading & Derivatives

• Advised a subsidiary of Vitol on the $2.3-billion takeover of African downstream oil business Vivo Energy.
• Represented a global commodities trader in several transactions, including:
  • The sale of a Permian Basin crude oil gathering and terminating system and related assets.
  • Negotiations with respect of a long-term natural gasoline (C5+) purchase agreement supporting the development and construction of a new U.S. Gulf Coast hydrotreater facility producing low sulfur natural gasoline meeting International Maritime Organization (IMO) 2020 requirements.
  • A joint venture (JV) with a midstream company and the acquisition of another midstream company that owns a crude oil pipeline system in Oklahoma and Texas.
• Advised a project sponsor in executing a physically settled energy swap with a swap dealer from an approximately 150-megawatt (MW) wind energy project.
• Represented a project company in executing a physically settled contract for differences (CFD) with a corporate offtaker for a solar project in the Pennsylvania-New Jersey-Maryland (PJM) Interconnection region.
• Advised a renewable energy company in executing an ISDA hedge agreement for an approximately 160-MW wind energy project in Texas.
• Represented a project company in executing a financially settled virtual power purchase agreement (VPPA) with a corporate offtaker of a wind project in the Midcontinent Independent System Operator (MISO) region.

Our experience encompasses the full range of trading issues, including the following.

Physical Trading

Our team guides clients through the complexities of financially settled and derivative transactions, credit derivative transactions, physically settled power swaps and hydrocarbon price swaps, including New York Mercantile Exchange (NYMEX) swaps, index swaps, basis FOM swaps, BOM swing swaps and exotic swaps in the exempt and cleared OTC markets.

Cash-Settled Hedging

We assist with financially settled derivative transactions, whether cleared or uncleared, from plain vanilla interest rate and commodity price swaps, to portfolio credit derivative, accelerated stock repurchase, heat rate call options (HRCO) and other more complicated hedging transactions.

Speculative Trading

We advise major energy companies, proprietary trading firms, commodities traders and hedge funds with respect to speculative trading of futures, options, swaps and other derivatives. We support clients in establishing trading and compliance programs and documenting risk management and marketing policies for their hedging groups, including assisting in the hedge committee approval process applicable to the addition of new trading instruments and advising on compliance with hedging exemptions from speculative position limits. Our team also effectively negotiates counterparty trading relationships and transactions with major investment banks, and advises in financially settled energy hedges for sponsors, developers and offtakers.

Commodity Finance

Our lawyers regularly advise on financing models for commodity purchases and trades.

Securities Trading and Repurchase Agreements

We assist clients with securities lending and repurchase transactions on both U.S.- and U.K.-governed industry standard documentation.

Regulatory and Enforcement

On the regulatory side, our experience extends to Commodity Futures Trading Commission (CFTC) rulemaking, swaps market requirements, speculative position limits and aggregation, and the regulation of exchanges and products. Our team includes former CFTC staff and other former members of key regulatory agencies. When enforcement activity occurs, we provide effective representation defending against investigations and other actions brought by the CFTC, the National Futures Association (NFA) and U.S. futures exchanges. We also assist clients with industry standard protocols to address topics such as Dodd-Frank, the Foreign Account Tax Compliance Act (FATCA), the U.S. Resolution Stay Regulations and the transition away from the London Interbank Offered Rate (LIBOR).