I Lack of liquidity and industry participation has killed off three LNG indexes published by the Singapore Exchange(SGX),dashing its hopes of developing an Asian LNG cargo price benchmark.But Singapore,one of the world's leading oil trading centers,hasn't given up plans to establish itself as Asia's LNG trading : hub.State-run terminal operator Singapore LNG is developing ancillary services such as LNG bunkering and break-bulking,and-in a rare move in Asia-it is offering third-party access to storage and reload facilities(WGI Feb.13'19).More firms are setting up LNG trading desks,encouraged by the city-state's business-friendly tax and regulatory regime,modern infrastructure and location.The SGX has meanwhile shifted focus to LNG freight pricing,having bought the Baltic Exchange,which provides daily freight market prices and maritime shipping cost indexes,in 2016.A spokesperson says it has launched a number of LNG shipping indexes since March,with two more targeted by year's end.All three indexes-the Singapore Sling and North Asia Sling,launched in 2015,and the Dubai-Kuwait-India(DKI)Sling in 2017-will be discontinued on Oct.31.The Singapore Sling assesses the free-onboard value of spot cargoes loading in Singapore.The North Asia Sling assesses the delivered ex ship price of cargoes to Japan,South Korea,China and Taiwan,and the DKI Sling of shipments to the Middle East and India.But they have been barely used for LNG physical and derivatives contracts,or referenced in deal-making,while a lack of market participation has triggered concerns about compliance and reputational risks,Energy Intelligence understands.The spokesperson said the decision to scrap the contracts is”in line with benchmark production best practices.”
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