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Authority to Board (ATB), Charter Party Agreement (CPA) & Notice of Readiness (NOR) Explained in Oil & Gas Shipping


Introduction

In compliant oil & gas shipping, delivery does not depend solely on vessels and cargo availability. The process is governed by critical operational authorizations and contractual documents that ensure safety, legality, and banking acceptance.

Among the most important are:
  • Authority to Board (ATB)
  • Charter Party Agreement (CPA)
  • Notice of Readiness (NOR)
This article explains what each document means, when it is issued, and why it matters in legitimate oil & gas transactions.
 
What Is Authority to Board (ATB)?

Authority to Board (ATB) is a formal authorization issued by the seller, terminal operator, or vessel operator allowing designated parties, typically independent inspectors (e.g. SGS), to board a vessel or access a terminal.
 
Purpose of ATB
  • Confirms inspection access is officially permitted
  • Demonstrates operational readiness
  • Indicates preliminary compliance has been met
ATB is usually issued after financial instruments (LC or SBLC) are confirmed, and before loading or inspection.
 
Important Note

ATB is not POP and does not confirm ownership. It simply authorizes access for inspection under controlled conditions.
 
What Is a Charter Party Agreement (CPA)?

A Charter Party Agreement (CPA) is a legally binding contract between a vessel owner and a charterer for the use of a vessel to transport cargo.

What CPA Covers
  • Vessel details and capacity
  • Charter duration and freight terms
  • Laytime and demurrage
  • Responsibilities for fuel, port charges, and delays
In oil & gas shipping, a valid CPA confirms that the vessel is:
  • Properly chartered
  • Seaworthy and insured
  • Legally available for the shipment
Banks and inspectors often rely on CPA existence to confirm vessel legitimacy.

What Is Notice of Readiness (NOR)?

Notice of Readiness (NOR) is a formal notice issued by the vessel’s master or agent declaring that the vessel has arrived and is ready in all respects to load or discharge cargo.

Why NOR Is Important
  • Triggers laytime calculation
  • Confirms vessel readiness
  • Forms part of official shipping records
NOR is commonly used in FOB, CIF, TTV, and STS transactions.

How ATB, CPA & NOR Work Together

a) In a compliant oil transaction:
  • CPA confirms the vessel is legally chartered
  • ATB authorizes inspection or terminal access
  • NOR confirms vessel readiness at port

b) Together, these documents ensure:
  • Operational readiness
  • Regulatory compliance
  • Banking and inspection acceptance

Banking & Compliance Perspective

Banks recognize ATB, CPA, and NOR only when:
  • Issued after valid LC or SBLC activation
  • Verifiable through official channels
  • Aligned with the SPA procedures
Any request to issue these documents before banking compliance is a major red flag.

Common Misunderstandings to Avoid
  • ❌ ATB means cargo is free to inspect anytime
  • ❌ CPA proves cargo ownership
  • ❌ NOR guarantees immediate loading
Each document has a specific role and should not be misinterpreted.

Why These Documents Matter to Buyers

For buyers, ATB, CPA, and NOR provide:
  • Transparency into shipping readiness
  • Protection against fake vessel claims
  • Assurance of operational legitimacy
Understanding these documents helps buyers avoid non-compliant or speculative offers.

Conclusion

Authority to Board (ATB), Charter Party Agreement (CPA), and Notice of Readiness (NOR) are core operational documents in oil & gas shipping. When issued correctly and supported by banking instruments, they confirm that a transaction is real, compliant, and executable.

👉 In the next article, we will explain ETA, Unconditional DTA, and Authorization to Verify (ATV) in oil shipping.