|
|
 |
 |
 |
| Texas Eastern Transmission Co. (Tetco) Eastern Louisiana Basis Swap Futures (Platts IFERC) |
|
The Texas Eastern Transmission Co. Eastern Louisiana zone begins midway between Baton Rouge and New Orleans. It encompasses eastern Louisiana, including New Orleans; the Mississippi River Delta, and offshore waters; and western Mississippi.
The volatility of natural gas prices has given rise to a basis market that is quoted as a differential to the price of the New York Mercantile Exchange, Inc., Henry Hub natural gas futures contract, which has evolved into the benchmark for forward natural gas markets industry-wide because of its liquidity and transparency.
To help market participants offset their price risk in this major market center, the Exchange provides a Tetco East Louisiana index natural gas basis swaps futures contract. The final settlement is calculated as Platts Inside FERC's Gas Market Report Tetco East Louisiana index minus the NYMEX Division Henry Hub natural gas futures contract final settlement price for the corresponding contract month. Platts Inside FERC calculates the index price from its monthly bid week survey.
The lot size of 2,500 million Btus represents a commonly traded market unit and is one-quarter of the size of the Henry Hub futures contract, giving market participants additional flexibility in managing price risk. The contract, which must be traded as a multiple of the number of calendar days in the month, is available for trading on the NYMEX ClearPortsm trading platform.
All positions will be aggregated and margined according to the value at risk as calculated by the SPAN® system. Cross margining of offsetting positions across markets can result in reduced margin obligations. |
|
|
|