In a first, India to launch natural gas trading on electronic platform next month
Rajesh Mediratta, Director at IGX said in a virtual event today the company hoped to launch the platform in March itself, however, lockdown measures in-place to deal with the Covid-19 pandemic has led to delay.
New Delhi: Indian Gas Exchange (IGX), a wholly-owned subsidiary of Indian Energy Exchange (IEX), hopes to launch natural gas trading on its platform beginning next month if the on-ground situation improves.Rajesh Mediratta, Director at IGX said in a virtual event today the company hoped to launch the platform in March itself, however, lockdown measures in-place to deal with the Covid-19 pandemic has led to delay.IGX would be India’s first online gas trading platform for physical delivery of natural gas. Initially, the company has identified Dahej, Hazira and Kakinada as delivery points and will subsequently include Dhabol, Kochi, Ennore and Mundra terminals.According to Mediratta, all trades which will take place on the platform will be for physical delivery and non-transferable. Trading of natural gas will take place in rupee and the minimum lot size would be 100 Million British Thermal Units (MMBTU).Speaking at the event, D K Sarraf, Chairman of Petroleum and Natural Gas and Regulatory Board (PNGRB), said due to disruptions caused by the ongoing Covid-19 pandemic the regulator is currently not sure if IGX requires any special permission from the government to launch the platform.He added that IGX’s natural gas trading platform will be different from the government’s natural gas trading hub and the regulator is awaiting approval from the government to take further steps to launch its own platform.Speaking about IGX, Sarraf said: “This would facilitate price discovery leading to the natural gas market becoming more transparent. Market would become more efficient and demand and supply would help in shaping the market. This would also increase the confidence of buyers and sellers in the market, many players in our interaction with the industry have raised concerns on the use of natural gas as the market is not that developed or transparent. Market size is also expected to increase due to this.”Mediratta said IGX has already conducted two mock trading sessions in March and April with significant participation from the industry.