Cargo Basis Differential Clause Samples

Cargo Basis Differential. If the pricing basis for a Cargo negotiated between Seller and a third party supplier is based on [REDACTED] index pricing for the Cargo Bank Hedge-Month then the Cargo Basis Differential for such Cargo shall be $[REDACTED] if the pricing basis negotiated by Seller with the third party supplier is not based on [REDACTED] index pricing for the Cargo Bank Hedge-Month (such as a transaction based on “Dated ▇▇▇▇▇” pricing) the Cargo Basis Differential will be [REDACTED]. As a part of the hedge based pricing process described in this Clause 9(b)(ii), the Parties agree that, no later than the Business Day prior to the first day of pricing being set between the parties by Buyer nominating it is being delivered such Cargo, the third party pricing basis shall be converted to an appropriate [REDACTED] futures contract basis, with an appropriate corresponding hedging month to be used in such pricing (the “Hedge-Month”). Should Buyer fail to follow the procedure below to designate the Hedge-Month and or set the [REDACTED] based index pricing for the Cargo Bank Hedge-Month within the allowed time period, Seller, in its sole discretion, can hedge the Cargo in the best way Seller sees fit and using the hedging futures contracts it deems most appropriate, and the actual difference between such hedging contracts and the third party pricing basis shall be used as the Cargo Basis Differential. For any Cargo that has been acquired to cover a Requirement, Buyer shall have the option at all times (subject to the limitations detailed later in this Clause 9) to contact Seller and request a fair market price assessment for the difference between: (A) the value of the pricing basis that make a part of the commercial terms negotiated in the acquisition of a Cargo, and (B) the value of the [REDACTED] futures contract and associated Hedge-Month which will be used as the new pricing basis for such Cargo. The chosen Hedge-Month associated with such futures contract should be either the [REDACTED] applicable when the Cargo is due to price. The choice of which contract month will be the Hedge-Month shall be Buyer’s election. The Cargo Number and Hedge-Month shall be advised by Buyer to Seller by telephone when Buyer requests the fair market price assessment. Promptly upon receipt of Buyer’s request (and time shall be of the essence in this respect), Seller shall seek a fair market assessment and contact Buyer by telephone to advise Buyer of that assessment. Promptly upon receipt of market...