| March 22
March 22 With the United States about to become
a net exporter of natural gas for the first time in 60 years,
Intercontinental Exchange Inc (ICE) said on Wednesday it will
soon begin trading a first-ever U.S. liquefied natural gas (LNG)
The new contracts will begin trading in May. The exchange is
rolling them out as growing LNG exports propel the U.S.
transition from a net importer of gas to a net exporter of the
fuel, which is expected to happen later this year or in 2018.
ICE said the contracts will be cash-settled against the
Platts LNG Gulf Coast Marker (GCM) price assessment and use
Platts-derived U.S. GCM LNG forward curves for daily settlement
purposes. The curves will have an initial tenor of 48 months.
"Domestic and international market participants now have a
risk management solution that lays the foundation for a more
effective means of hedging their spot and forward exposure,"
said J.C. Kneale, vice president, North American power and
natural gas markets at ICE, in a statement.
U.S. gas producers, plagued by low domestic prices in recent
years, are eager to sell into the international marketplace
The last time the country was a net exporter of gas on an
annual basis was in 1957. It started exporting gas from the
lower 48 states in February 2016. Five other U.S. LNG export
facilities are currently under construction and expected to
enter service by 2019.
That growth will propel the United States into the third
biggest exporter of LNG by the end of 2020, according to S&P
Global Platts, which provides the price assessment for the ICE
"We believe the U.S. Gulf Coast is poised to become a key
anchor for LNG prices,” said Shelley Kerr, global director of
LNG and regional director of generating fuels & electric power,
Europe, Middle East and Africa (EMEA) at S&P Global Platts.
She said growth in Asia-based LNG swaps has already been
strong, and now "counterparties are demanding that the new
flexible supply from the U.S. is underpinned by both price
transparency and the means to hedge."
(Reporting by Scott DiSavino; Editing by David Gregorio)