Singapore's CLTX bourse to launch coal futures in first quarter

Thu Jan 23, 2014 8:08am EST

Related Topics

* CLTX to start API2 and API4 derivatives

* CLTX was bought by Germany's EEX in Dec 2013

* Both bourses also eye LNG products, but no date set

LONDON, Jan 23 (Reuters) - Singapore-based Cleartrade Exchange (CLTX) plans to launch coal futures in the first quarter of this year, expanding the reach of new owner European Energy Exchange (EEX), CLTX's chief executive said on Thursday.

Germany-based EEX, which offers European power, natural gas, coal and emissions trading products, bought a 52 percent stake in CLTX, which focuses on shipping products, in December last year.

"We will launch API2 (European) and API4 (South African) coal futures products pretty imminently. It should be this quarter," said CLTX's CEO Richard Baker during a joint press briefing with EEX in London.

EEX's chief executive Peter Reitz said the new products were part of a drive to offer customers a full range of products on one platform.

"If you operate a coal-fired power station, you have to buy the coal and charter freight. You also have to buy emissions certificates, and then sell the electricity. You can now do all this on our platforms," Reitz said.

Leipzig-based EEX is majority-owned by Deutsche Boerse Group , Germany's biggest exchange operator.

Deutsche Boerse has said that it wants to expand in Asia, and Reitz said the acquisition of CLTX was part of that drive.

EEX and CLTX both said that liquefied natural gas (LNG) products were also of interest although no clear dates for introduction were set yet.

"New (emissions) regulation in the shipping sector are prompting changes towards using LNG as a fuel. We also need to take into account that there is a shale gas revolution going on," Baker said.

New shipping regulation is aimed at pushing the sector from using fueloil towards more LNG as a shipping fuel, which is cleaner than oil, and a shale gas production boom is expected by many analysts to bring down global natural gas prices.

Despite these developments, Baker said "the strategic changes in the shipping sector (from oil to gas) are still a way out."

EEX's Reitz said that LNG transported globally to supply utilities with gas for power generation was also a potential product his exchange could introduce for trading.

"LNG is clearly an option as it is a global product and Singapore is very well placed, but there is no launch date yet," he said.

Around 70 percent of global LNG trading is based in Asia, with Japan and South Korea, and increasingly also China and India, acting as the main buyers, and Qatar and increasingly Australia being the main suppliers. (Reporting by Henning Gloystein; Editing by Mark Potter)

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