CHICAGO, Jan. 21, 2011 /PRNewswire/ -- CME Group, the
world's leading and most diverse derivatives marketplace, today
announced the introduction of three new natural gas futures
contracts physically delivered at Pine Prairie Energy Center
(PPEC), which is owned by PAA Natural Gas Storage, L.P. (NYSE:
PNG). The contracts will be traded on the NYMEX floor,
electronically through CME Globex and available for clearing
services through CME ClearPort. The contracts will be listed on
February 6, 2011 for trading on
February 7, 2011, and will be listed
with, and subject to, the rules and regulations of NYMEX.
The PPEC delivered natural gas futures contracts are an
extension of CME Group's flagship natural gas benchmark product
offering by providing customers shorter-term contracts including:
daily, balance-of-month and monthly contracts all with backstopped
delivery. These contracts are sized at 2,500 MMBtu per day during
the delivery period and priced at a minimum increment of
$0.0025 per MMBtu. PPEC has received
Federal Energy Regulatory Commission (FERC) approval to make
modifications to the PPEC Gas Tariff allowing for new services to
accommodate these contracts.
"Our new Pine Prairie Energy Center delivered natural gas
contracts were developed to meet the fast-moving, short-term and
long-term base load needs in today's natural gas marketplace," said
Joe Raia, Managing Director, Energy
& Metals Products. "The launch of these innovative contracts is
another testament to CME Group's commitment to providing customers
with access to the broadest array of products for managing global
energy risk."
"We believe the combination of CME Group's resources with PPEC's
operational capabilities will provide natural gas industry
participants with a recognized, flexible and scalable physical
balancing location," said Todd
Brown, VP-Optimization for PNG. "These new contracts
fill an important need and should attract additional participants
and increase an already healthy level of hub services volume at
Pine Prairie. The increased
liquidity should benefit new and existing customers."
The three PPEC futures contracts to be listed include: PPEC
Physically Delivered Natural Gas Daily/Weekend Futures
(PPD), PPEC Physically Delivered Natural Gas BALMO Futures
(PPB) and PPEC Physically Delivered Natural Gas Monthly
Futures (PPM). These contracts provide the dual benefit of
termination through backstopped physical delivery and security of
an exchange-cleared transaction.
The physical delivery point for these contracts will be the
PPEC, a highly-flexible salt cavern storage facility located in
Evangeline Parish, Louisiana.
PPEC is strategically located 50 miles from Henry Hub and has
nine interconnects to eight major pipelines that service the Gulf
Coast, Midwest, Northeast and Southeast markets.
As the world's leading and most diverse derivatives marketplace,
CME Group (www.cmegroup.com) is where the world comes to manage
risk. CME Group exchanges offer the widest range of global
benchmark products across all major asset classes, including
futures and options based on interest rates, equity indexes,
foreign exchange, energy, agricultural commodities, metals, weather
and real estate. CME Group brings buyers and sellers together
through its CME Globex electronic trading platform and its trading
facilities in New York and
Chicago. CME Group also
operates CME Clearing, one of the largest central counterparty
clearing services in the world, which provides clearing and
settlement services for exchange-traded contracts, as well as for
over-the-counter derivatives transactions through CME ClearPort.
These products and services ensure that businesses everywhere
can substantially mitigate counterparty credit risk in both listed
and over-the-counter derivatives markets.
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CME-G
SOURCE CME Group