National Commodity & Derivatives Exchange Signs Memorandum Of Understanding For Natural Gas Spot Trading

National Commodity & Derivatives Exchange Limited (NCDEX) and GAIL (India) Limited signed a Memorandum of Understanding (MoU) on 15th February 2005 in New Delhi. This will enable both the organizations to jointly work for the development of a spot market for natural gas in the country. The MoU was formally signed by Mr P.H. Ravikumar, MD & CEO, NCDEX Ltd and Dr U.D. Choubey, Director, Marketing, GAIL (India) Ltd.

NCDEX would make available an on-line trading platform to the users of GAIL to trade in spot contracts of natural gas. NCDEX and GAIL have also agreed to jointly educate the stakeholders about the natural gas trading platform. A core team will be formed to design the contracts, risk management processes and clearing & settlement mechanism in this regard. The core team would work seamlessly with the users to promote natural gas trading.

Speaking on the occasion, Mr Ravikumar said, “This tie-up with GAIL is very significant for NCDEX as it marks a major step taken by us in the energy sector. GAIL, India’s principal gas transmission and marketing company, has contributed immensely to the nation's gas-based economy with a countrywide presence of pipelines, plants and marketing network. This collaboration would leverage the synergies between the two organizations to deliver better results for all the participants”.