THE GOVERNMENT MADE A DECISION TO DEVELOP ON-EXCHANGE TRADE WITH GAS
Decree of the Government of the Russian Federation No. 1063 of 17 August 2019 made amendments to the existing gas trading procedure
The Decree is adopted in order to further develop the market principles of gas pricing and to fulfill the Road Map for competition development *.
“Gazprom” PJSC and its affiliated persons can sell up to 25 billion m³ of the produced natural gas per year through on-exchange trading. The parity principle between “Gazprom” PJSC and independent companies for on-exchange sale of natural gas is abolished.
The Decree not only increases the sales limit but also gives FAS the right to recommend “Gazprom” PJSC selling particular quarterly volumes of natural gas through the exchange.
Head of FAS Igor Artemiev commented the amendments: “These changes will enable consumers to additionally satisfy the needs in gas, acquiring it on-exchange at free prices. The amendments also increase on-exchange gas sale, which will ensure ongoing trade liquidity for further transition to pricing with use of on-exchange quotations”.
He added that “the gas sector must shift from government regulation to market relations in gas supplies”.
The Federal Antimonopoly Service has been developing on-exchange trading since 2014 to execute the decision of the Commission at the President of the Russian Federation on developing the fuel-and-energy complex and environmental safety.
As of 30 June 2019, the total volume of gas sold on-exchange reached 67.5 billion m³. There are 103 participants of on-exchange trading, 417 on-exchange gas consumers, and 6 on-exchange sellers of natural gas. Overall 47 regions participate in on-exchange trading.
* Approved by the Government of the Russian Federation to execute No. 618 Order of the President of the Russian Federation “On the main areas of the state policy towards competition development” of 21.12.2017