Northland Energy

Northland Energy Trading, LLC is an over-the-counter derivatives company, founded by Rich Larkin in 1998. Northland’s mission is to provide energy risk management tools to the clients of Hedge Solutions. These tools typically take the form of options, which are offered in customized increments depending on the needs of the client. Products for all commodities in the energy complex are offered: heating oil, gasoline, crude oil, natural gas, and propane.  Northland’s ability to offer less than standard contract volume (42,000 gallons) makes energy risk management accessible to small businesses. The time frame of coverage is also determined by the client, varying from a few days to several months.

Calls, Puts, and Option Combinations

  • End of Month – financially settled to the NYMEX futures price on the last business day of the contract month
  • Daily Offset – written for a specific time period; financially settled on a daily basis to the NYMEX futures price; you specify the liquidation schedule (volume per day to be offset) up front
  • Average Price Offset – financially settled on the last business day of the contract month to the average NYMEX futures price over the contract month

Basis Instruments

Northland can write options to settle against NYMEX futures or cash markets quoted by Platts and OPIS

  • Rack Basis Guarantee – lock in basis at a specific rack location

Swaps

  • Rolling Swap – financially settled on the last day of the contract month to the NYMEX futures price
  • Bullet Swap – written to expire on a specific day; financially settled on the day of expiration to the NYMEX futures price
  • Calendar Swap – financially settled on the last day of the contract month to the average NYMEX futures price over the contract month
  • Crack Swaps – financially settled to the spreads between NYMEX crude, heating oil, and/or gasoline futures

 

The information provided on this website is general market commentary provided solely for educational and informational purposes.  The information was obtained from sources believed to be reliable, but we do not guarantee its accuracy.  No statement within this website should be construed as a recommendation, solicitation or offer to buy or sell any futures or options on futures or to otherwise provide investment advice.  Any use of the information provided on this website is at your own risk.