This program is engineered around the containment of risk. The capital you commit through the bond is held as collateral behind a top-tier-bank credit instrument. Within an individual transaction it may also be applied to operational purposes, facilitated by a letter of credit issued against that instrument.
Bond capital backs the bank credit instrument that guarantees payment to fuel sellers. Where capital is applied to operational purposes within a transaction, that application is made under a letter of credit issued against the instrument, so the use is documented, transaction-specific and bounded by the instrument rather than advanced at large. Investors should note that capital applied operationally is at risk within that transaction and is not held solely as untouched collateral. Optional bond insurance is available for an additional layer of capital protection.
Title to the fuel is never transferred until the product is paid for in full; the seller retains legal ownership until settlement. The underlying fuel always remains a real, resaleable commodity — not a receivable or a paper claim. If a buyer fails to complete, the asset has not left the seller’s ownership and is redirected to one of multiple pre-qualified backup buyers. The asset is never stranded.
Before any delivery, every buyer must post a full-value (100% of transaction value) SBLC or DLC from a top-tier bank, converting the buyer’s payment obligation into an irrevocable bank guarantee. Combined with retained title, each transaction is secured on both sides at once.
| Risk type | Severity | Mitigation |
|---|---|---|
| Counterparty | Low | Rigorous vetting; multiple pre-qualified backup buyers. Title passes only on payment in full, and each buyer posts a full-value SBLC/DLC. |
| Fraud | Low | Third-party verification of all trade documents (MT103s, Bills of Lading); KYC/AML screening on every counterparty for the life of the program. |
| Credit | Low | Credit instruments issued only by top-tier, investment-grade banks; optional bond insurance protects against bank-level events. |
| Supply / origin | Low–Med | Origin diversification across multiple vetted suppliers; matched 12-month contracts reserve takeoff in advance with backup-source clauses. |
| Market / price | Medium | Matched buy-sell contracts lock the fixed percentage spread before execution; returns are not contingent on Platts price levels. Pre-defined floor-price circuit breakers. |
| Geopolitical / sanctions | Low | Transacts only in non-sanctioned product flows with sanctions-screened counterparties in vetted jurisdictions. |
No seller or buyer participates without completing a rigorous, dual-layer four-stage vetting process — minimizing default, fraud, and regulatory exposure.
Proof of past transactions (Bills of Lading, invoices); Corporate Info Sheet (ownership, financials, capacity); background check (reputational, sanctions, AML/CFT); refinery contract verification (direct allocations).
Proof of past purchases (invoices, MT103 receipts); Proof of Funds (Bank Comfort Letter, statements); Corporate Info Sheet; background check (AML/CFT, beneficial owners).
Reference and floor levels are pre-defined and disclosed. EN590 references roughly $865/MT with a $200/MT floor (a 3x-plus cushion); Jet A references roughly $85/bbl with a $25/bbl floor (about a 3.4x cushion). If prices fall below the floor for 30 or more consecutive days, the operator may suspend distributions while maintaining principal protection, adjust the target return in line with reduced margin, or in extreme cases wind down early and return investor principal — always communicated promptly and transparently.
Refined fuel products show low correlation to equity and bond markets and have historically held resilience through geopolitical volatility, providing portfolio de-risking. Because the program earns a locked buy/sell differential rather than betting on consumption growth, it is largely insulated from gradual shifts in fuel demand.