India launched its first natural gas trading exchange on June 15 in a move to increase market-driven pricing and boosting consumption, according to The India Times.
IEX, India’s leading power trading company, is offering up the platform with Dahej and Hazira in Gujarat and Kakinada in Andhra Pradesh as delivery locations for pricing contracts. The location of the delivery hubs implies that trading will be limited to imported gas until there is sufficient output from domestic fields.
Contracts will be structured in two main ways. The first will be taken care of by IEX, whereby they sort out transportation/delivery. In the second, the buyers take care of the delivery and book transmission capacity.
This is part of India’s plan to increase gas consumption to account for 15% of the country’s energy mix in 2030, up from 6.2% in 2018. Thus, liquefied natural gas (LNG) imports are set to become a larger proportion of domestic gas consumption.