1. The Trade Structure & Core Thesis
Trade Overview
- Commodity: Light Crude Oil.
- Volume Commitment: 2 Million barrels per month (1 Million bbl every 15 days).
- Contract Term: 3-Year Off-take Agreement.
- Seller: Direct Crude Oil Producer.
- End Buyer: Established Refinery (End Consumer).
- Trade Cycle: Buy from producer (payment at loading) → Deliver to refinery (90-day credit).
- Scalability: Model is readily scalable to other refineries with shorter 30-day credit terms.
Core Investment Thesis
- Fixed Payout: Investor profit is a fixed $2.00 per barrel, ensuring predictable monthly earnings.
- Credit Cycle Capture: Capital is deployed to bridge the gap between prompt payment to the seller and the 90-day credit extended to the buyer.
- Off-take Security: Security is derived from the committed, long-term consumption by the end-user refinery.
- High Volume / High Yield: The high volume and fixed margin structure deliver significant annualized returns.
- Market Hedge: Investor return is fixed per barrel, minimizing exposure to price volatility during the trade cycle.
- Future Expansion: Immediate opportunity to replicate the model with other refineries (30-day credit), allowing faster capital velocity.
2. Counterparties and Supply Chain Strength
Managing credit and supply risk through confirmed relationships with primary oil players:
The Producer (Seller)
Direct crude oil producer, guaranteeing consistent 2 million bbl/month supply and ensuring competitive acquisition pricing.
The Refinery (End Buyer)
Established industrial consumer requiring continuous Light Crude feedstock, securing the critical long-term off-take commitment.
Payment Terms
Seller is paid at the loading port. Buyer has 90 days credit, which the working capital investment covers.
3. Principal Security: Bank-Guaranteed Off-take
The 90-Day Credit Bridge Security
The principal investment is shielded from refinery credit risk by a bank-backed payment instrument:
- Bank Instrument: The End Buyer's bank provides a bank guarantee, assuring payment of the full cargo value at the end of the 90-day credit period.
- Principal Security: The investor's principal is fully secured by this bank instrument from the moment the cargo is delivered to the refinery's port.
- Deployment: Capital is deployed at the loading port to acquire the cargo and is repaid 90 days later by the buyer's bank.
- Buyer Stability: The 3-year P.O. commitment from the established refinery, combined with the bank's guarantee, delivers maximum security and longevity.
4. Operational Alignment and Management
1. Required Working Capital
Investment covers 3 months of cargo value to sustain the continuous 90-day credit period for the refinery.
2. Transaction Expertise
Team possesses specialized logistics and finance expertise required to execute high-volume, credit-backed crude oil shipments.
3. Scalable Expansion
Proven model allows for immediate expansion to clients requiring shorter credit terms (30 days), accelerating overall capital velocity and profits.
5. Working Capital Structure & Structured Payout Profile
Secured Working Capital Commitment
Investment Required: USD 360 Million
Monthly Investor Payout
USD 4.0 Million
Annual Structured Return
USD 48 Million
⇒ 13.33% Target Annualized Return
The investment finances 2 million barrels per month for 12 months, yielding a fixed profit share of $2.00 per barrel.
Fixed Payout per Barrel
USD 2.00
Trade Volume Commitment
72 Million Barrels
Base Contract Tenure
36 Months
Next Steps
Immediate Focus: Finalize Due Diligence and deploy USD 360 Million working capital.
Target: First loading within 45 days of investment close.
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