Southern France gas trading hubs to merge on April 1

PARIS Feb 24 (Reuters) – The two gas trading hubs in the south of France will merge on April 1, power trading group Powernext said on Tuesday, marking a first step towards a unified French gas platform aimed at preventing the large price swings currently seen in the market. France is divided into three gas hubs, but pipeline bottlenecks between the northern hub called Peg Nord and the southeastern Peg Sud prevent Norwegian and Russian pipeline imports from flowing to the south of the country. This makes Peg Sud, and the third gas hub, TIGF, in the southwest, more dependent on relatively more expensive liquefied natural gas (LNG) imports, weighing on local industry’s competitiveness. The spread between Peg Nord and Peg Sud day-ahead gas prices, which last stood at 0.25 euros per megawatt-hour (MWh), reached a record of 12.29 euros in December 2013 on the French gas bourse Powernext. <0#PNXGPSN:> On April 1, the existing Peg Sud and Peg TIGF, which have been trading on Powernext since November 2008, will be replaced by a common market area under the name Trading Region South (TRS), with spot and futures contracts tradeable from March 31. “A more liquid southern French area will … continue reading

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