* BP says it is first major oil, gas business to publishtemplate
* Seen as a move to standardise LNG contracts, boostliquidity
* BP's oil GT&Cs already widely adopted across crude, oilmarkets(Adds comment from BP and lawyer)
By Jessica Jaganathan
SINGAPORE, Aug 16 (Reuters) - Global oil and gas major BPhas published its master sales and purchase contract templatesfor its liquefied natural gas (LNG) trading business and says itis the first of its peers to do so.
BP, which has a global LNG portfolio made up ofvolumes it has produced or bought, said on its website itexpects that publishing its LNG master sales and purchaseagreement (MSPA) templates will "contribute to the broaderdiscussion around standardisation and liquidity for LNGtransactions."
The LNG industry has been pushing to streamline andstandardise the contracts that govern its market to cut down onred tape and lengthy negotiations to speed up the commodity'stransition to an oil-like trading model.
A BP spokeswoman told Reuters on Friday the companypublished the free-on-board MSPA template this week and adelivered ex-ship template in April as part of efforts to drive"simplification, standardisation and liquidity in LNG markets."
BP already has a standardised template - known as itsgeneral terms and conditions (GT&Cs) - for the sale and purchaseof crude oil and refined oil products that is widely used byother companies as well.
An MSPA is a complex framework agreement between twocounterparties spelling out the general terms for their LNGdeals. Unlike in oil markets, where standardised GT&Cs like BP'sprovide a framework for traders to refer to, in LNG markets,companies typically draft separate contracts for every deal.
Companies have to draft several MSPAs before conducting anactual trade, spending time, money and resources in a processthat can range from minutes to weeks or longer.
In 2017, international commodity trader Trafigura alsoreleased an MSPA to encourage standardization of contracts inthe LNG industry.
The publication of standard-form MSPAs by market playersrather than industry bodies is potentially a step towardsgreater transparency within the LNG industry, said Jessica Ham,a lawyer with legal firm Ashurst, which handles LNG contracts.
"Particularly if other portfolio sellers and traders followsuit, (it) could be helpful in promoting discussion around howcontracting parties can increase efficiency to respond to thefaster pace at which the spot LNG market is moving in recenttimes and the greater liquidity," she said.
With LNG spot volumes expected to grow as new liquefactionprojects come online, standardised contracts could lower entrybarriers and attract more companies to the market, according toindustry participants.
Since the third quarter of last year, bids, offers andtrades reported to pricing agency S&P Global Platts as part ofits pricing process have become "significantly more homogenouswith regards to the terms used," said Ciaran Roe, globaldirector of the company's LNG division.
These terms include nomination deadlines for the deliveryport, the loading port and the LNG carrier for use in a trade,Roe said.
Platts assesses the widely adopted Japan-Korea-Marker (JKM)in the Asian spot market.(Reporting by Jessica Jaganathan; Editing by Tom Hogue)
BP (BP.)