JV with Vessel Owner

Based on a comprehensive analysis of all provided oil trading procedures from Ametheus—including CIF (with steps for LOI/FCO/ICPO/SPA/POP/DLC/shipment/discharge/payment/title transfer, flow charts, and pricing formulas), VTT FOB (with vessel-to-tank unloading at discharge port, POP docs, dip test, and payment against verification), as well as prior ones like TTV FOB, VTO/STO FOB, STS FOB, VTT FOB (core), TTO FOB, TTT FOB (8 procedures), Joint Venture basics, and UDTA—I’ve finalized the JV procedure. This integrates secure, phased transaction elements (e.g., credential verification, POP sets, inspections, and payment instruments from TTT/CIF), while emphasizing the 7 factors for strategic alliances (strategy first, joint planning, end planning, trust-building, starting small, tracking, capability-building).

The procedure is primarily FOB-based (risk transfer at origin loading port, buyer pays Ametheus upon vessel exit post-loading), but includes an optional CIF extension where the JV takes the vessel to the buyer’s destination port for discharge (VTT unloading if needed), enabling a premium rate (e.g., +5-10% on Platts pricing to cover freight/insurance/risks). This option is negotiated in the SPA for high-value deals or buyer preferences, with Ametheus leading decisions as JV lead. Oil is procured from a Seller/Refiner, loaded via TTV onto the JV-chartered vessel. Payment flows: Exit Buyer pays Ametheus (on loading exit for FOB; post-discharge Q&Q for CIF option), then Ametheus distributes to Vessel Owner (chartering fees, e.g., 30-40%) and Oil Seller/Refiner (product costs, e.g., 60-70%), retaining JV margins.

Incoterms: Primarily FOB 2020 (with TTV loading); optional switch to CIF 2020 for premium deliveries.

Product Location: In shore tanks at loading port (e.g., Fujairah, Rotterdam, Jurong, Houston), transferred to JV vessel; optional delivery to discharge port tanks via VTT.

Mode of Delivery: TTV FOB loading at origin; optional STS en route or VTT unloading at destination for CIF.

Price Basis: Negotiable on Platts NWE/Asia-Pacific/Arab Gulf/Mediterranean/MOPS market scan, FOB TTV base; premium adder for CIF option (e.g., +freight/insurance via Platts 7 days pre-loading fix).

Inspection: SGS/Intertek/Saybolt-Corelab or equivalent, at loading (seller’s tank/vessel) and optional discharge (buyer’s tank); dip test authorization (DTA/UDTA) if requested at buyer’s expense.

Payment Terms: Buyer pays 100% via MT103 (or DLC for high-risk/CIF) to Ametheus upon loading exit/Q&Q confirmation (FOB) or post-discharge Q&Q (CIF). Ametheus distributes within 72 hours. Optional UDTA for deferred elements.

JV Structure: Limited liability JV between Ametheus (lead: trading/sales) and Vessel Owner (ops: vessel management), with 50/50 equity split, shared risks/profits, and governance per 7 factors. Start small (one vessel/pilot trade), track quarterly, plan exit (e.g., 12-month term with buyout).

Key Steps

  1. JV Formation and Planning (Incorporating JV/T TT Elements): Ametheus and Vessel Owner exchange LOI/CIS/KYC, conduct due diligence (financial assessment per buyer policy, extended to partners), and form JV entity (e.g., LLC). Sign JV Agreement (JVA) outlining equity/roles/profit-sharing/disputes, aligned with 7 factors (e.g., strategy: optimize vessel for FOB/CIF trades; joint planning: chartering terms; trust: shared audits). Register JV; Ametheus funds initial setup (reimbursed from profits).
  2. Vessel Chartering Agreement (From VTO/STO/CIF): JV charters vessel (time charter, 6-12 months) from Vessel Owner via Charter Party Agreement (CPA). Include Q88, cleanliness certificate, and insurance (110% cargo value). Verify seaworthiness (ISGOTT/SOLAS). For CIF option, extend charter to cover voyage to discharge port.
  3. Oil Procurement from Seller/Refiner (From TTO/TTT/CIF): JV (Ametheus lead) issues FCO to Seller/Refiner with JV CIS/license. Seller/Refiner responds with allocation letter/POP (e.g., Q&Q <48 hours, COO, injection report). Sign SPA with Seller/Refiner (FOB terms; payment upon JV receipt from Buyer). If CIF option, include discharge logistics.
  4. Buyer Engagement and Contract (From CIF/TTT/VTT): Ametheus issues FCO to Exit Buyer with JV details/signatory passport. Buyer responds with ICPO (signed with passport/CIS/license), POF (e.g., BCL/SWIFT), TSA (tank storage agreement at discharge for CIF/VTT), and preferred schedule/shipping agent. Verify Buyer credentials (individual/JV: financial assessment). Sign tri-party SPA (JV, Buyer, Seller/Refiner) specifying FOB base or CIF option (with premium pricing formula: base + freight/insurance via Platts fix 7 days pre-loading). If CIF, Buyer provides TSR/PAPC 5 days pre-arrival.
  5. POP and Verification (From All Procedures): JV shares full POP from Seller/Refiner in JV/Buyer name (e.g., allocation letter, ATSC authorizing JV to sell/collect, Q&Q report, COO, injection report, TSR/TAC/ATV/Hub No./Booking No./DTA). Buyer verifies within 48 hours. For dip test (at Buyer’s expense), issue UDTA/DTA (unconditional, notarized, with tank/seal details). Fresh SGS in Exit Buyer’s name; only one POP set if allocation-based.
  6. Payment Instrument Setup (From CIF/UDTA): For standard FOB: Buyer issues POF. For high-risk/CIF/large volumes: Buyer issues irrevocable/transferable/divisible DLC (60 days) via MT799 draft, confirmed MT700. JV verifies at nominated bank.
  7. Loading Preparation and Execution (TTV FOB Base, From TTV/CIF): Buyer nominates inspector. JV coordinates tank access with Seller/Refiner. Transfer oil to JV vessel (pipeline/hose, metering/sampling). Inspector verifies Q&Q (composite samples, ASTM/IP standards). Issue NOR upon completion. Vessel exits loading port. Share scanned docs (e.g., B/L in 3 originals, commercial invoice, packing list, COO, CPA, cargo manifest, product passport, Q&Q certificate, master’s receipt, flowmeter report, Q88, ullage, time log, cleanliness cert, release note, export license, registration, customs clearance, commitment to supply, authorization to sell/collect, ownership affidavit).
  8. Optional CIF Extension (Delivery to Destination, From CIF/VTT): If elected in SPA for premium: JV sails vessel to discharge port (Buyer provides instructions/TSR/PAPC). Upon arrival, conduct VTT unloading to Buyer’s tanks (injection paperwork with logistics). Re-inspect Q&Q at discharge (dip test if requested). Buyer confirms receipt per final Q&Q report. Vessel released post-confirmation.
  9. Payment and Distribution (From CIF/TTT/MT103):
    • FOB: Buyer pays 100% MT103 to Ametheus upon loading exit/Q&Q docs verification.
    • CIF Option: Buyer pays via DLC drawdown + MT103 difference (based on final Q&Q/market fluctuation) post-discharge confirmation.
    • Ametheus distributes: chartering fees to Vessel Owner, product costs to Seller/Refiner, retains JV margins (e.g., 5% retention escrow for disputes, released after 30 days). Pay intermediaries within 48 hours.
  10. Title Transfer and Closure (From All): JV issues Certificate of Ownership/Title transfer to Buyer (in conformity with loading/discharge Q&Q). Audit transaction (quarterly tracking). Extend for roll-overs (12 months) if successful; follow exit plan otherwise.

Required Documents (Consolidated from All Procedures)

  • JV/Chartering: LOI/CIS/KYC (partners), JVA, registration, CPA, Q88, cleanliness cert, insurance.
  • Procurement/Sales: FCO (to Seller/Refiner/Buyer), ICPO (from Buyer), SPA (tri-party), POF/DLC (MT799/MT700), TSA (for CIF/VTT), POP set (allocation/ATSC/Q&Q/COO/injection/TSR/TAC/ATV/DTA/UDTA).
  • Loading/Delivery: B/L (3 originals), invoice (3 originals), packing list, COO, CPA, manifest, passport, Q&Q cert/report, master’s receipt, flowmeter, Q88, ullage, NOR/ETA, time log, cleanliness, release note, export license, registration, customs, commitment, authorization, dip test result, ownership cert/affidavit, insurance (110%).
  • Closure: Title transfer cert, final Q&Q, payment receipts (MT103/DLC), audit report.

Parties’ Obligations

  • Ametheus (JV Lead): Form JV, handle trading/procurement/sales, receive/distribute payments, decide FOB/CIF, ensure compliance/no-sanctions.
  • Vessel Owner (JV Partner): Provide/manage vessel, handle ops (loading/sailing/discharge for CIF), receive fees.
  • Oil Seller/Refiner: Supply oil/POP, facilitate loading, receive costs from Ametheus.
  • Exit Buyer: Issue ICPO/POF/DLC, verify POP, conduct inspections (dip test expense), provide TSA/TSR/PAPC (CIF), pay Ametheus per terms, handle final discharge if FOB.
  • All: Credential verification, adhere to 7 factors, ASTM/IP standards, cooperate on Q&Q.

Risks and Mitigations

  • Delays/Demurrage: Laytime clauses; Buyer pays if nominated delays.
  • Q&Q Discrepancies: Independent inspections; 5% escrow retention.
  • Defaults: POF/DLC security; UDTA for verification.
  • JV Disputes: JVA governance/exit.
  • Fraud: Neutral procedures, full POP in Buyer’s name, ATSC authorization.

Notes

  • Full POP/Fresh SGS in Exit Buyer’s name; ATSC authorizes sale/collection.
  • If discharge port not Fujairah/Jurong/Rotterdam/Houston, mandatory DLC.
  • Premium for CIF: Negotiated in SPA (e.g., base price + market fluctuation via Platts).
  • Start small (pilot trade) to build trust/capability.
  • Governing Law: ICC/UCP 600; English law disputes.

Buyer Credential Verification Policy:

To ensure a secure and reliable transaction process, the financial capability of buyers intending to purchase fuels will be thoroughly verified.

  • Individual Buyers: Credentials of the buyer must be provided for financial assessment.

  • Joint Ventures (JV): If the buyer is importing fuels in partnership with another financially robust entity, both parties must submit their credentials for verification.

All provided information will be reviewed to confirm the buyer’s ability to fulfill the financial obligations of the purchase.

Indemnity Clause: In the oil procurement process, we strictly adhere to our established procedures, which are designed to be neutral, transparent, and structured to prevent scams and fraud in the oil trade. These processes ensure compliance, security, and fairness for all parties involved. Our procedures apply solely subject to the availability of the product.

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Disclaimer : We hereby declare that we do not accept or source any fuel or petroleum products from Russia, Iran, or any other sanctioned country.

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