New Delhi, Mar 26 (IANS): The Indian Gas Exchange (IGX), India's first authorised Gas Exchange, has introduced open auction trading on its platform.
The trading through new formats has commenced with effect from Thursday. The proposal for change was made to downstream regulator PNGRB and the same was approved by it last week, IGX said in a statement.
The move is aimed at enhancing the ease of trade for the market participants and allowing them the price and volume visibility across hubs. The new trading features would encourage greater participation on the Exchange and help to build the gas markets.
The Monthly, Fortnightly, Weekly and Weekday contracts will have an Open Auction mechanism, while the Daily contracts will be traded through Continuous Trading mechanism. In Double-sided Open Auction, both sellers and buyers will have access to the information regarding price and quantity shared by the various sellers on the platform. The auction is expected to lead to the discovery of a single uniform clearing price for each contract type.
With the introduction of Open Auction mechanism, the buyers will now be able to compare gas prices across the hubs and make bidding decision based on the most competitive gas pricing for the required duration. The Continuous Trading methodology introduced in Daily contracts will facilitate immediate trading for short duration contracts. The market participants trading under Daily contracts will not have to wait for the market to end to get the trade information. It will also allow trading multiple times during the trading hours.
Further, the market trading hours on the Exchange have also been extended by an hour from 10 a.m. to 1.00 p.m. now.
Speaking on the new development, Rajesh K. Mediratta, Director, IGX said,"... we have introduced Open Auction for all contracts except for Daily contracts. In Daily contracts we will follow Continuous Matching system based on the feedback provided by the stakeholders. These modifications will allow the participants to view the best prices in the trading system and tweak their bids accordingly. Also, we have introduced few ease-of-trading measures like uploading of all bids at one shot reducing traders' time and chances of errors, and easy access to historical order and trade books."
IGX, currently, offers trade in five contracts at three physical hubs -- Hazira and Dahej in Gujarat and KG Basin in Andhra Pradesh. The Exchange has over 500 registered clients and 16 members and has cumulatively traded 1,93,700 MMBTU volume of gas so far.