Platts clarifies current mapping approach for its ICE Kern River natural gas location

Platts, part of S&P Global Commodity Insights, has observed a mapping disconnect for the ICE Kern River Gas Transmission Co. - on system receipt location published as the ICE Kern River, on system receipt location (JAACA03 for monthly and JAACA00 for daily).

The ICE Kern River Gas Transmission Co. - on system receipt daily and monthly location allows for delivery onto the pipe at the following locations: CIG Muddy Creek, NWP Muddy Creek, Opal, Painter, Whitney Canyon, Anschutz, Goshen, Clear Creek, Overland Trails, Carter Creek, Overthrust, Pioneer Plant and Questar Roberson Creek, if both counterparties agree.

Based on our current methodology, the ICE Kern River Gas Transmission Co. - on system receipt location is mapped to the Platts Kern River, Wyoming, monthly index regardless of the location the gas is being delivered onto the pipe. However, if the gas is delivered at Muddy Creek or Opal, it would also be included in the Platts Northwest, Rocky Mountains and Platts Northwest, Wyoming Pool indices.

This mapping methodology can create a mismatch with a Platts price submitter ICE trade being mapped to the three Platts indices and a non-Platts price submitter ICE trade being mapped to just one index.

As an example, on day one of the bidweek, there is an ICE trade executed at Kern River Gas Transmission Co. - on system receipt. The buyer is a Platts price submitter and the seller is not. The preliminary bidweek index for Kern River, Wyoming reflects both sides of the trade -- the buy and sell.

At the end of bidweek, the buyer, a Platts price submitter, reports the trade at Muddy Creek. Based on our methodology, this trade would be part of three indices: Kern River, Wyoming; Northwest, Rocky Mountains; and Northwest, Wyoming Pool. However, based on our methodology, the sell side of the trade, reported to Platts by ICE as ICE Kern River Gas Transmission Co. - on system receipt, would only be part of the Kern River, Wyoming index.

Not only are the buy and sell sides of the trade not mapped the same, but the trades are mapped differently in the preliminary indices than in the final indices.

Below are three possible mapping scenarios. Platts would like to clarify that it currently utilizes Scenario 3 and intends to continue using this approach going forward as it results in each side of the trade being mapped according to our methodology based on the best information received at the time.

• Scenario 1 would apply the strictest ICE definition and map both sides of the trade only to Kern River, Wyoming, even when the price submitter trade is reported as Muddy Creek or Opal.
• Scenario 2 would add the applicable ICE side of the trade to the Platts Northwest, Rocky Mountains and Northwest, Wyoming Pool indices if a Platts price submitter reports the trade as Muddy Creek or Opal.
• Scenario 3 would keep the trades in the applicable indices based on the information received. ICE trades would only be mapped to the Kern River, Wyoming index, while trades reported as Muddy Creek or Opal by Platts price submitters would be in the Kern River, Wyoming index, as well as the Northwest, Rocky Mountains and Northwest, Wyoming Pool indices.

Below is how the index prices published in Inside FERC's Gas Market Report would have been affected using the three different mapping scenarios for two recent months.

Similar scenarios apply to the daily market in relation to the ICE Kern River Gas Transmission Co. - on system receipt location and the Platts Kern River, Opal and Northwest, Wyoming Pool indices published in Gas Daily.

Our Methodology and Specifications Guide can be found here .

Please send any comments on the mapping approach described above to AmericasGasPricing@spglobal.com and pricegroup@spglobal.com by April 28, 2023.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.