The Australian Energy Operator`s New Gas Trading Exchange (AEMO) is expected to enter service on March 20, 2014. The Gas Trading Exchange is the first step in the development of a gas supply centre that focuses on Wallumbilla in Queensland. National allocation rules require AEMO to conclude the exchange agreement, which contains the material rights and obligations of market operators. It is a multilateral agreement involving the stock exchange operator and all those who sign accession agreements. The agreement defines the process of participation and access to the electronic exchange platform, trade agreements, prudential requirements, transaction closing and delivery and settlement obligations. “We expect the market to be reorganized in 12 to 24 months to meet the changing needs of operators. Industry will play a leading role in the definition of new exchange products. “Mr. Geers concludes. The stock exchange is a forum to bring together buyers and sellers, to trade short-term gas on standard terms. With respect to its role in the gas market, the stock exchange has almost nothing in common with the Victorian wholesale gas market (DWGM) or the short-term market (STTM). The main features of the gas trading exchange are: the new supply node is flexible in its design, as new sites and products can be added to the needs of the industry. It differs from mandatory demand markets, which generally cover a specific distribution territory and are primarily designed to align gas supply with demand.
The Wallumbilla Gas Supply Hub offers products for the sale and purchase of gas, delivered by one of Wallumbilla`s three major pipelines. Participants place anonymous offers (for sale) or offers (to be purchased) at a certain price, and these are automatically cross-referenced on the exchange to make transactions. The amendments to the National Gas Act2 established AEMO`s gas trading functions. Overall, these AEMOs require the creation, operation and management of one or more gas trading exchanges. The National Gas Act also made it possible to change the national rules on the implementation of the gas exchange. These amendments came into effect on 1 January 2014 and have added a new part 22: the hub will establish standardised conditions as part of an exchange agreement developed by market participants. In developing market design, AEMO looked at gas platforms and gas exchanges in the US and EU. While the organization of the Wallumbilla gas exchange is based on certain characteristics of these facilities, it necessarily reflects the underlying gas market and regulatory environment in Australia.
For example, unlike some EU gas exchanges, the stock exchange operator does not register delivery appointments and there is no clearing mechanism in the underlying gas market to deal with fluctuations in supply. The Exchange does not yet offer hub services (such as compression or storage) offered on other platforms, usually by gas carriers, and support trade and liquidity.1 Wallumbilla is an important transit point between Queensland and other gas markets on the east coast of Australia.