Platts proposes launch of DES Southeast Asia LNG (SEAM) cargo assessments

Platts, part of S&P Global Commodity Insights, is proposing to launch DES Southeast Asia (SEAM) price assessments reflecting the value of spot LNG cargoes delivered into Southeast Asia markets, effective Oct. 16, 2023.

Platts would publish the assessments as a differential to Platts JKM as well as on an outright basis. Southeast Asian LNG imports have grown significantly over the last two years and are expected to grow further as new importing countries enter the market.

BASIS AND LOCATION: Cargoes delivered ex-ship (DES) to ports in Thailand, Singapore, Vietnam and the Philippines that can receive a minimum cargo size of 135,000 cu m would be considered in the assessment.

TIMING: Platts would assess cargoes for delivery in the third, fourth, fifth and sixth half-month cycles forward from the date of publication. The SEAM monthly assessment would be based on the average of the two DES Southeast Asia LNG halfmonths that match the JKM delivery month period.

Bids and offers provided for publication in the Market on Close assessment process would typically reflect delivery into ports in Thailand, Singapore, Vietnam and the Philippines, with buyer's option to nominate discharge port. Platts is seeking feedback from the market via this subscriber note on which ports to reflect as the basis disports in the assessment.

Bids must be expressed with a specific base discharge port. The location chosen would set the conditions for any potential counterparty considering trading. For transactions concluded and reported through the MOC process, buyers should nominate a base discharge port at least 30 days before the first day of the traded delivery window, or at the time of trade confirmation for a prompter delivery window.

Buyers would retain the option to substitute discharge port within the basis disports in Southeast Asia up to 15 days before the first day of the traded delivery window, subject to ship shore compatibility study (SSCS).

DELIVERY WINDOW: The delivery period reflected by bids and offers would typically be three days long, with the buyer's option to narrow to a one or two-day delivery window by 30 days before the first day of the traded delivery window.

LOADING LOCATION: Platts would reflect bids, offers and trades where sellers have the option to nominate the base loading port up to 30 days prior to the first day of the traded delivery window and may substitute the loading port up to 15 days prior to the first day of the traded delivery window, subject to Gross Heating Value (GHV) quality range reported in the trade. Offers of cargoes for delivery at or less than 30 days from the date of assessment would have to state a base loading port explicitly.

QUALITY: Market participants should clearly state GHV specifications in bids and offers submitted for publication. Platts DES Southeast Asia assessments would reflect cargoes with a GHV of 1,000-1,150 Btu/Scf. Platts may normalize for quality specifications with different ranges.

QUANTITY: DES Southeast Asia assessments would reflect quantity of 3.4 TBtu. Under this proposal, this volume would be subject to +/-5% operational tolerance, at the seller's option.

For cargoes offered or bid for in a volume range (e.g. 3.3-3.5 TBtu +/-5%), the specific volume (e.g. 3.4 TBtu +/-5%) would have to be declared by the seller 30 days prior to delivery.

LNG VESSEL: Platts standards would reflect LNG vessel size range of 135,000-175,000 cu m. Sellers would nominate an LNG ship either 30 days prior to the first day of the traded delivery window, or at the time of trade confirmation for a prompter delivery window.

For offers of cargoes for delivery at or less than 30 days from the date of assessment, sellers should state the LNG vessel explicitly. Sellers may substitute delivery vessel up to 15 days prior to the first day of the traded delivery window, subject to SSCS.

Standard terms: Unless stated otherwise by a counterparty at the time of providing data for publication, the bids and offers provided for publication in the MOC process should reflect these standards, which Platts understands to be broadly typical in the spot market for cargoes delivered into Southeast Asia.

Platts may publish bids, offers and trades for LNG cargoes that carry different terms and conditions, but may normalize these when considered in final, published assessments. Participants in the MOC process should clearly state in submitted bids or offers terms that differ from these standards.

Please send all feedback, comments and questions to LNGeditorialteam@spglobal.com and pricegroup@spglobal.com by Sept. 12, 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 make comments not marked as confidential available upon request.