Wednesday 29 October 2014

Russia Launches Natural Gas Trading At SPIMEX

World’s second largest natural gas producer, Russia has launched its first auction of natural gas on Oct 24 at the St. Petersburg International Mercantile Exchange (SPIMEX). It will be Europe’s largest natural gas trading post.

The project is intended to create a more competitive market for natural gas prices, which at present are more-or-less tied to oil. Now, independent producers will have access to a broader range of buyers.

The exchange will facilitate up to 35 billion cubic meters of gas annually, with Gazprom, Russia’s largest producer, maintaining the right to sell a half of that, and independent producers the remaining 17.5 billion cubic meters.

During the first trading session, Gazprom and eight independent gas producers will sell 882.6 million cubic meters of gas for November volumes. The gas will be delivered to two compressing stations - Nadym (552.6 million cubic meters) and Vyngapurovskoye (270 million cubic meters), which are connected to Russia’s gas transportation system (GTS). The supplies are not eligible for re-sale.

SPIMEX is the largest commodity exchange in Russia. SPIMEX was first registered in May 2008, receiving its official license to trade the following month. In September 2008, the exchange registered its first trades in diesel and jet fuel. It now offers spot and derivatives contracts, and covers a wide variety of petroleum products.

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