MERCHANDISER
EEX Launches Clearing Product for NBP Market
THE EUROPEAN ENERGY EXCHANGE sees great potential for the European traded gas sector. As long-term oil price based supply contracts give way to more a meaningful representation of gas market dynamics, gas trading throughout Europe finally seems to be taking off. Trading volumes are rising strongly, led by the Dutch, German and UK markets. Having expanded exchange gas trading with the Dutch TTF
market area last year, EEX is further enhancing its product portfolio by offering clearing for bilaterally concluded transactions on the UK’s National Balancing Point (NBP). “Our range of products will become even more
international and supplemented with a clearing product for the biggest European gas hub,” says Peter Reitz, EEX’s CEO.
Gas Market Areas Connected to EEX
directly registered on EEX by brokers whilst cross margining across products and partner exchanges provides additional savings. OTC clearing also simplifies trading processes, reducing administrative work. Thus, trading efficiency, liquidity, and security will be stimulated in the UK gas sector. Trading participants can register trades directly at EEX.
An additional opportunity to use the new clearing offer is the registration of transactions via brokers. Daniel Simpson, director of energy at Tullett Prebon Energy comments: “Tullett Prebon is happy to offer its customers the new EEX/ECC NBP cleared contract. We see this as a competitively priced alternative to existing clearing solutions and as such are happy to add it to our suite of products to allow customers to fully take advantage of benefits it may offer them in terms of cross margining.” For the financial evaluation of the positions in NBP
futures contracts settlement prices are used according to the standards common on the NBP gas market. These end of day settlement prices are provided by the London Energy Brokers’ Association (LEBA) and are reflective of true OTC market conditions. “We are happy to work with EEX to offer competitive clearing
for Europe’s biggest gas market. The new OTC clearing service for NBP gas provides market participants with greater choice and, therefore, increases clearing competition in this established market area,” says Alex McDonald, CEO of LEBA. EEX once again reached a record last year in natural gas
GASPOOL Title Transfer Facility (TTF) National Balancing Point (NBP)
NetConnect Germany (NCG) NBP remains by far the most liquid of Europe’s gas hubs,
even as its share of traded volumes has declined – largely as a consequence of continental European trading expanding. In addition to trade in the GASPOOL, NCG and TTF market areas, EEX participants can register UK NBP forward transactions conducted off-exchange at EEX for clearing and nomination purposes. Clearing is provided by European Commodity Clearing (ECC) which assumes full settlement of the transactions including physical fulfilment. EEX decided to enter the NBP market because the benefits to
its members were obvious. What followed was a consultation with participants, both traders and brokers, to define a product offering that works and to foster support for the launch. Those trading participants that are already admitted on the EEX Derivatives Market for Natural Gas can use this new offer once they have registered at ECC. Key to the EEX offering are its benefits to customers in
terms of cross margining and the cross-exchange benefits of a common clearinghouse, with ECC participants able to generate significant savings. OTC-cleared deals can be
26 March 2012
trading. Volumes increased 25% year-on-year to 58.6 TWh – with spot market volumes increasing 54% to 23.1 TWh and derivatives trading rising 11% to 35.5 TWh. The number of gas trading participants also increased to 105. The new NBP offering is being coordinated from EEX’s
recently opened London offices under the stewardship of Louis Hems who heads the Gas &Coal department. “TheNBP market is a key addition to EEX’s and ECC’s gas portfolio – by adding it in 2012, we bring an even more comprehensive gas offering to all of our members, from utilities and producers to banks and hedge funds. The benefits of collateral reduction due to our new cross-margin savings cannot be underestimated at times when credit in the market is tightening,” confirms Hems. “The creation of our London office and the formation of our
dedicated London team was a very important milestone for us. That commitment has helped us immeasurably in bringing us closer to the UK market and enabled us to establish closer relationships with our customers and will help us attract new participants,” says Oliver Maibaum, EEX Managing Director and head of the UK office. EEX and ECC are offering trading participants a ‘fee holiday’ until 28th
February 2013 enabling them to familiarise
themselves with the products and processes. This exemption from fees includes trade registration as well as fees for clearing and delivery. In addition, EEX takes over the submission of the transactions to the clearinghouse. This automatic “take-up service” reduces the effort involved for traders.
www.eex.com
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84