Platts Middle East Marker reflects growing importance of the
Middle East as a LNG
destination
LONDON, Jan. 16, 2017 /PRNewswire/ -- S&P Global
Platts ("Platts"), the leading independent provider of information
and benchmark prices for the commodities and energy markets, today
announced the launch of a new Liquefied Natural Gas (LNG) price
assessment for the Middle East
region, The Platts Middle East Marker (MEM).
Shelley Kerr, Global Director,
LNG, S&P Global Platts said: "We are launching this new
assessment in response to changes in market activity. The Platts
Middle East Marker (MEM) price assessment is designed to reflect
the growing importance of the Middle
East as an LNG import destination rather than just exporter
of cargoes. Our analysis indicates a greater tendency for new
entrants in the region to use short term purchasing strategies,
which is creating additional liquidity. This liquidity is further
compounded by the participation of trading companies who are
willing to take on the additional price and credit risk associated
with these new buyers. Platts is firmly committed to helping the
development of LNG markets by bringing increased transparency and
our price assessments are based on a structured and clear
process."
The Platts MEM complements the Platts Japan-Korea Marker, the
leading LNG benchmark globally that was launched in 2009 in
response to a growth in LNG spot market activity. It was the first
daily assessment for spot LNG globally and is used as a pricing
basis in short, medium and long term contracts as well as to settle
financially traded LNG contracts.
The Platts MEM will cover the spot price of cargoes delivered
into Middle East ports (in UAE,
Egypt, Jordan, Kuwait) as well as in Pakistan, where
over a period of two years, LNG imports have climbed from 5.9
billion cubic meters (bcm) of gas in 2014 to 28.6 bcm in 2016. Part
of this has been driven by the use of floating storage and
regasification units (FSRUs) in all five markets, which allowed
each country to begin importing on short notice and also rapidly
expand capacity by leasing another floating unit.
Egypt accounts for over one
third of the volume going into the Middle
East. The Egyptian port of Ain Sukhna will be used as the
basis point for the marker, reflecting the tender based procurement
strategy adopted by Egypt that is
driving spot market trading activity. Deliveries into other ports
will be normalized back to Ain Sukhna using an assessed freight
deviation cost.
At the same time, demand outside of Egypt is expected to grow in other markets
including Kuwait, which has
committed to developing more import capacity, the UAE which will
see more emirates importing LNG and in Bahrain which will begin imports before the
end of the decade.
The Platts MEM will be assessed on a delivered ex-ship (DES)
basis reflecting deliveries at ports in the Middle East capable of receiving cargoes with
a minimum cargo size of 135,000 cubic meters. It will be published
each business day and reflect market values prevailing at the close
of markets at 16:30 London time,
and will be available on the following Platts services: Platts
Natural Gas Alert (NGA), Platts LNG Daily, Platts LNG Navigator and
Platts Market Data.
About S&P Global Platts
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more information, visit www.platts.com.
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