IGX trading falls 80 percent due to high costs, extended winter

The Indian Gas Exchange (IGX) trading fell by 80% yearly due to rising gas costs and a longer winter, which reduced gas-based power consumption.

The Indian Gas Exchange (IGX) traded 1.13 Million MMBtu (~28 MMSCM) of gas volume in March’24, lower by 80% year over year due to an increasing trend in gas prices and an extended winter reducing gas-based power demand.

A total of 65 trades were executed during the month. The maximum number of trades were executed in the Daily contract, 23 trades, followed by Fortnightly & Monthly contracts, 15 and 14 trades, respectively.

The most active delivery point for free market gas was Dahej & KG Basin for Ceiling Price gas. Other trading delivery points were Ankot, Suvali, Mhaskal & Bhadbhut.

During the month, the exchange-traded gas deliveries were 28,83,950MMBtu (~2.34 MMSCMD).

GIXI (Gas Index of India) for March 2024 was ₹799/$9.6 per MMBtu, lower by 10% from last month. GIXI—South was ₹. 677/$8.1 per MMBtu and GIXI-West ₹814/$9.8 per MMBtu. Different spot gas benchmark prices were HH at ~$ $1.5/MMBtu, TTF at ~$ $8.5/MMBtu, and LNG benchmark indices were WIM at ~10 $/MMBtu.

The total Domestic ceiling price category gas traded during the month was 3,31,100 MMBtu at below ceiling price (avg. ₹730/MMBtu) at the KG Basin delivery point.

In the Financial Year 2024, IGX witnessed significant activity, with a total trading volume of 41 Million MMBtu lower by 20% Year over Year mainly due to a decline in sales by domestic gas producers and its resale by marketers. Domestic Ceiling Price Gas accounted for 23.3 Million MMBtu, while Free Market Gas trade touched a record 17.5 Million MMBtu, an increase of 20% Year over Year. There were 998 trades executed throughout the year.

Gadimoga emerged as the preferred delivery point for Domestic Ceiling Price Gas, whereas Dahej dominated Free Market Gas trades. Daily and Monthly contracts were the most popular choices, followed by Weekly, Fortnightly, Day-ahead, and Weekday contracts.

IGX currently offers delivery-based trade in six different contracts: Day-Ahead, Daily, Weekday, Weekly, Fortnightly, and Monthly, under which the trade can be executed for six consecutive months.