Litigation & Arbitration support expertise
Litigation & Arbitration support expertise
Context & Objectives
Context: a price review has been requested by the Client on a long-term gas major supply contract. A first valuation of the contract has been made on a netback approach by an independent expert. Given the huge stake of the PR, such valuation had to be cross-checked and completed by a third-party analysis made by Emerton
Objectives:
- Assess the consistency, robustness and accuracy of the valuation model and propose adjustments as the case may be
- Provide a quantitative analysis of the European retail markets of the PR: profitability of gas retailers analysis of gross margins, net margins, identification of the price drivers and price references on each market segment
Outcome
- Robust, detailed and clear expert report
- Very positive issue of the PR for our client
Our approach
External review of the netback value model
- Detailed analysis of the whole set of assumptions made on each element of the value chain of natural gas commercialization: supply options and wholesale markets, transmission and distribution, modelling of storage and modulation, gross and net margins, commercial costs, retail gas prices structure and levels per market segment
- Identification of risks, proposal of detailed adaptations and fine-tuning of the valuation model
- Major improvements of the robustness and reliability of the model
Construction of an expert report on targeted European retail markets
- Quantitative analysis of retail market dynamics: market shares of players, HHI index, major supply schemes, competition intensity
- Analysis of commercial offers per market segment and final customers’ expectations e.g. direct access to wholesale markets, development of joint purchasing
- Detailed quantitative analysis of retail margins and marketing costs per market segment
- Role of midstream infrastructure operators
Our experts
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