LNG cargo export indexed to Singaporean firm’s futures for the ‘first time’

A liquefied natural gas (LNG) cargo trade has been indexed to the LNG futures of Abaxx Commodity Exchange and Clearinghouse, owned by Abaxx Singapore, whose majority shareholder is financial software and market infrastructure company Abaxx Technologies, in what the firm says is the first over-the-counter (OTC) trade of its kind.

As stated by Abaxx, two Asia-based firms agreed to trade an LNG cargo to be exported from the Gulf of Mexico (GOM) with the transaction price indexed to Abaxx GOM LNG futures.

The Singaporean player sees this as a significant milestone since it shows the potential for its LNG futures to become a benchmark in global LNG markets.

“This trade reflects the need for more precise LNG pricing as geopolitical shifts, including tariffs and trade disputes, continue to impact global commodities markets,” said Joe Raia, Chief Commercial Officer of Abaxx Exchange.

“The use of Abaxx futures settlement prices for this high-value cargo gives the global LNG market confidence in the strength of our contracts and reinforces their role as a reliable tool for managing price risk with benchmarks that reflect real LNG market conditions more reliably than regional pipeline hubs or proxies.”

As for the Gulf of Mexico–known in the U.S. as the Gulf of America, like the rest of the U.S., the area has been teeming with LNG activity following the administration change in the country.

The new administration has decided to put more focus on LNG and reverse the export ban that was previously in force. This has enabled several projects to move forward, most recently NextDecade’s Rio Grande LNG project in Texas, thanks to a revised court judgment.