KCBT Amends CFTC Filing To Alter Western Natural Gas Contract

The Kansas City Board of Trade today amended its filing with the Commodity Futures Trading Commission to convert the western natural gas futures contract from a "flat price" contract to a "basis" futures contract. The changes pertain to the reference price being used as the basis for the futures contract. The KCBT's western natural gas basis futures contract will now trade as a basis to Inside FERC's South Louisiana Henry Hub region index price. Previously, the exchange intended to use the NYMEX natural gas futures settlement price as the reference price. The exchange expects to begin trading basis futures contracts effective with the February 2000 contract month upon CFTC approval. The anticipated start date of the basis futures contract remains Monday, Nov. 29, 1999. KCBT western natural gas futures and options were launched in August 1995 as a risk management tool for the western U.S. market. The contract has a delivery point of PG&E Gas Transmission's Permian/Waha Hub in west Texas.