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Crude Quality and IMO Presenter: Rusty Braziel

IMO 2020 is the International Maritime Organization’s 2020 rule that will require the shipping industry to limit marine bunker

fuel usage to 0.5% sulfur fuel from 3.5%S fuel oil, marking a massive shift in distillate demand as well as an underlying increase

in demand for lower-sulfur crude slates. The rule goes into effect January 1. How are international shippers preparing for the

upcoming changes and what effect will the rule have on U.S. refiners? In this module, Rusty will discuss the different solutions

available as well as some likely outcomes.

NGL Arbitrage and Netbacks Model Presenter: Simon Hill

As anyone who’s talked shop with an LPG trader knows, international trading of propane and butane (collectively LPGs —

Liquified Petroleum Gas) is a wild, roller-coaster kind of business. This model on international LPG trading looks behind the curtain

and drills down into the nuances that make the difference between success and failure in this traditionally opaque world. In it,

Simon Hill will walk us through the calculation of the spread between U.S. supply markets and international demand markets, also

known as the arbitrage.

International Connections Presenter: David Braziel

As North American crude, gas, and NGL production volumes have surged, domestic supply/demand dynamics have been roiled

and now the U.S. increasingly relies on exports to balance the market. In the next five years, those trends will continue with

production forecasted to continue increasing based on RBN’s three price scenarios. Our production forecast includes gas, crude

and NGLs and considers the amount that would need to be exported to keep apace with supply output.

Global Crude Markets Presenter: Rusty Braziel

U.S. crude production, coupled with Canadian imports, far outstrip domestic demand, pushing ever increasing volumes of crude

to export docks. Which leads to two critical questions — namely, how much actual crude oil export capacity is already in place at

the Gulf Coast, and how much more needs to be developed? The ability of North American crude to access international markets

will depend on the pricing of those barrels and the capacity of export docks to handle all of the incoming supplies. From there,

the oil will travel to Europe, Latin America and, most significantly, to Asia.

Package 5 – International

2© Copyright 2019 RBN Energy, LLC

SCHOOL OF ENERGY INTERNATIONAL Package 4 – Natural Gas Liquids

Canadian Crude and Natural Gas Markets Presenter: Martin King

North America’s surge in production hasn’t been isolated to the United States. Since 2010 Canada’s Western Canadian

Sedimentary Basin (WCSB) crude oil production has increased by 2 million barrels per day, straining takeaway infrastructure. But

unlike in the States, Canadian crude is often heavier, which makes it worthwhile to complex Gulf Coast refiners looking to balance

their slate against lighter American shale production. For that reason, Canada remains the 4th largest exporter of crude oil in the

world and 98% of its crude exports are to the U.S. And it’s not just oil. Natural gas from the Montney has also seen a substantial rise

in volumes, with total WCSB now producing nearly 16 bcf/d. Like oil, that has put a strain on takeaway infrastructure and pressure

on local prices. In this module, Martin King looks at supply and demand for crude and gas with an eye towards future trends and

how new infrastructure projects may affect those dynamics.

Liquified Natural Gas Markets Presenter: David Braziel

As U.S. natural gas production has surged, domestic demand has strained to keep pace and the result has been an overall

decline in natural gas prices. The release valve of this oversupplied market is exports. The first wave of Liquified Natural Gas (LNG)

terminals is online and the second wave is starting to ramp up. But how many such liquefaction plants will the U.S. need and how

much more LNG can the global market absorb before it, too, is saturated? One thing we know for sure is that the 50+ bcf/d of

proposed North American terminal capacity can’t all get built. In this module we’ll look at those terminals which are online, those

which are under construction, and those which have been announced but for which Final Investment Decisions have not yet

been made.

Global LPG Markets Presenter: Simon Hill

The U.S. flipped from being a net LPG importer to a net exporter in 2012. Since then, export volumes shipped to overseas

destinations have been rising like a rocket. As that happened, the U.S. has increasingly competed against other LPG exporters for

global market share including the Far East and India. In this module, Simon Hill examines those trends and how they have shaped

the global LPG trade.