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Crude Oil, Condensate, and Natural Gas Liquids Marketing Agreements

Michael E. Korenblat, Tim Kirwin, Oil & Gas Agreements: Midstream and Marketing

This paper provides an introduction to marketing agreements for crude oil, condensate, and natural gas liquids from both a commercial and legal perspective. A basic overview of the market players, their varying interests, and factors that influence pricing is included to help provide a general understanding of the crude oil marketplace. An overview of the key industry terms of these marketing agreements is also provided, with a more detailed discussion regarding confirmation procedures and credit, security and related issues.

This paper focuses solely on domestic transactions. Marine and derivative transactions, which form a very important part of this marketplace, are beyond the scope of this paper and are not discussed in any detail. As the marketing agreements covered are purchase and sale agreements, which share many provisions and concepts with purchase and sale agreements generally, the overview of their terms is kept a high level, except for the areas of emphasis noted above.