CME Group announces Exclusive Licensing of Net Energy Daily Index

CME Group announces Exclusive Licensing of Net Energy Daily Index for Western Canadian Select Heavy Crude Oil


CME Group, the world’s leading and most diverse derivatives marketplace, today announced an exclusive licensing agreement for the Net Energy Canadian Daily Index for Western Canadian Select Heavy Crude Oil. CME Group plans to offer cash-settled cleared swaps on the New York trading floor and through CME ClearPort®, a set of flexible clearing services open to over-the-counter (OTC) market participants to substantially mitigate counterparty risk and provide neutral settlement prices across asset classes. Trading and clearing is scheduled to begin in the second quarter of 2010.These contracts will be listed by NYMEX and subject to the rules and regulations of NYMEX and CME. 

 Calgary-based Net Energy Inc. provides daily settlement prices for spot and forward energy contracts and compiles, maintains and publishes indexes comprised of energy settlement prices. 

 “CME Group recognizes the need for exchange-cleared contracts in the fast-growing Canadian energy marketplace,” said Joe Raia, CME Group managing director of energy products and services. “We will offer our customers the ability to trade our entire crude oil slate, including our global WTI benchmark contract, against the most actively traded Canadian crude contract. The agreement also paves the way for providing cross margining opportunities that will enable customers to take advantage of the capital efficiencies sought in today’s energy marketplace.” 

 “We are very pleased to have finalized this innovative agreement with CME Group,” said Tim Gunn, Chief Executive Officer of Net Energy Inc. “The Net Energy customer base will now have the ability to take advantage of the size and scope of the CME Clearing House to help mitigate counterparty risk for trading the Canadian crude oil contract.   This contract is exactly what many of our customers have been asking for as it introduces flexibility in their risk management programs and added liquidity to the marketplace.