IGX sees significant rise in Oct trade volumes
New Delhi: The Indian Gas Exchange (IGX) recently reported a substantial increase in natural gas trading volumes for October 2024, with a total of 8 million MMBtu (201 MMSCM) traded, marking a 160 per cent month-on-month (MoM) growth.
This surge is attributed to decreased Administered Pricing Mechanism (APM) gas allocations to the City Gas Distribution (CGD) sector and elevated global LNG prices, which have collectively driven market participants to seek alternative sources of supply.
The Gas Index for October 2024 (GIXI) stood at Rs 1098/ $13 per MMBtu, reflecting a 4 per cent decrease from the previous month. Regional variations were observed, with GIXI-South at Rs 986/ $11.7 per MMBtu and GIXI-West at Rs 1102/ $13.1 per MMBtu.
In contrast, international gas benchmark prices showed an upward trend, with the Henry Hub (HH) averaging ~ $2.6/MMBtu (up by 9 per cent MoM) and the Title Transfer Facility (TTF) at $12.9/MMBtu (up by 13 per cent MoM). The LNG benchmark index for WIM – Ex Dahej settled at ~14.3 $/MMBtu, a 1 per cent MoM decrease.
124 trades were executed in October, with the Dahej and KG Basin delivery points being the most active for free market gas. Other significant trading locations included Hazira, Suvali, Mhaskal, Ankot, and Bokaro.
Notably, 72 per cent of the total volume was traded at the Dahej delivery point, where the GIXI-Dahej for October was Rs 1100 or $13/MMBtu, a 3.4 per cent MoM reduction.
The WIM-Ex Dahej settled price for October 2024 was also at a similar level, i.e., $13.6/MMBtu.
The breakdown of traded volumes showed that approximately 7.8 Million MMBtu of free market category gas was traded during the month, while about 0.14 million MMBTU domestic ceiling price gas was traded at the KG Basin delivery point at a ceiling price of $10.16/MMBtu.
Additionally, 0.2 Million MMBtu of domestic gas with complete pricing freedom was traded at Bokaro (CBM), Hazira (ONGC Hazira), and KG Basin delivery points.
IGX facilitated gas deliveries totalling 6.1 million MMBtu (~5 MMSCMD) during the month. The exchange currently offers trades at 15 delivery points, including 4 LNG terminals, 3 pipeline interconnection points, and 8 domestic gas field landfall points.
It provides six different contract types for trade execution over twelve consecutive months: Day-Ahead, Daily, Weekday, Weekly, Fortnightly, and Monthly.
In October, the maximum number of trades (40) was executed in the Daily contract, followed by 29 trades each in the Fortnightly and Monthly contracts, 16 in the Weekly, 8 in the Day-Ahead, and 2 in the Weekday contract.
The significant increase in trading volumes and the dynamic price movements observed in October underscore the evolving nature of the Indian gas market, with participants actively adapting to changing supply conditions and global price signals. The IGX continues to play a pivotal role in providing a platform for efficient price discovery and trade execution, contributing to the development of a robust liquid gas market in India.
