LEAP Extends Industry Standard LOI for US Law
Leadership for Energy Automated Processing (“LEAP”) is pleased to announce that the workstream to standardize Letters of Indemnity (LOI), has now extended the proposed standard, to also include a US version for use where US Law is applicable. This extension follows a period of industry consultation, and is supported by the team of industry experts across all LEAP member companies, and now has their full support for adoption in their operational business activities.
Letters of Indemnity are an essential tool in the physical oil supply chain, ensuring there is an efficient interaction between companies during the deal life-cycle, which avoids unnecessary delays to cashflow. While many companies have their own LOI wording set out in the GTC’s, there are instances where this wording may not be mutually agreed between counterparties. The LEAP LOI wording provides an alternative which can then be used when such a situation arises.
Such a standard enables participating companies to share in the benefits which arise, not only from expediting cashflow, but also from allowing operational staff to devote less time to chasing variations in paperwork.
The new proposed industry text, including guidance notes is attached here and will be open for consultation until 16th March 2020. Please provide your comments (or any questions) to Peter Harvey, LEAP’s Programme Director: [email protected].
All comments received will be reviewed by the LEAP LOI workstream and any further amendment to the LEAP LOI wording will be communicated in March.
This document is provided by LEAP for the free and voluntary use of market participants.
LEAP’s mission is to enable excellent processing interaction in the energy supply & trading industry while capitalizing on standardization and digital innovation to create lasting efficiencies. More information about LEAP and how to join is available on our website.
Membership in LEAP is open to energy trading, service and association entities on a nondiscriminatory basis. All members must be legal entities, not natural persons.
