Singapore’s Abaxx Commodity Exchange and China’s Qingdao International Energy Exchange are exploring strategic collaboration in the physical liquefied natural gas (LNG) market.
As disclosed, the collaboration aims to promote cross-border cooperation in commodity trading between the two countries to advance sustainable energy solutions. It also aims to connect international suppliers with China’s demand centers and strengthen Asia’s LNG marketplace.
According to the Singaporean player, this will be done by combining Abaxx’s physically-deliverable LNG futures and clearing infrastructure with Qingdao International Energy Exchange’s established position in China’s energy markets.
“Partnering with Abaxx Exchange presents a significant opportunity to enhance connectivity between China’s energy market and global participants,” said a spokesperson at the Qingdao International Energy Exchange. “Together, we can foster a more robust, efficient and accessible LNG marketplace.”
The collaboration will focus on four key areas. The first one will entail developing mechanisms for cross-border LNG trade that will connect global suppliers with China’s demand centers, while the second is aimed at exploring the creation of transparent, market-driven LNG pricing references for the Asia-Pacific region.
As part of risk management, or the third aspect, the partners will seek to offer innovative clearing and settlement services to reduce volatility and enhance trading confidence. Finally, the partnership is expected to extend to a wider scope of energy market products as part of the fourth collaboration area.
“We are excited to work with Qingdao International Energy Exchange to strengthen the LNG trading ecosystem in Asia,” said Nancy Seah , CEO of Abaxx Exchange. “This engagement reflects our commitment to aligning international LNG benchmarks with China’s growing demand centers through infrastructure designed for physical trade flows.”
The Abaxx Exchange saw the first LNG cargo indexed to its futures earlier this year . As stated by the Singaporean firm, two Asia-based players agreed to trade an LNG cargo to be exported from the Gulf of Mexico (GOM), known as the Gulf of America in the U.S., with the transaction price indexed to Abaxx GOM LNG futures.