ICE to launch USG crude futures based on Magellan/Enterprise delivery

Quantum Commodity Intelligence - The Intercontinental Exchange is to launch a new physical-delivery futures contract based on US Gulf export crude, teaming up with terminal operators Magellan and Enterprise, ICE said in a press release.

"The Midland WTI American Gulf Coast contract is being launched in response to market interest for a Houston-based index with greater scale, flow assurance and price transparency," said ICE.

The Exchange operator added, 'the quality specifications of the new futures contract will be consistent with a West Texas Intermediate ("WTI") crude oil originating from the Permian Basin with common delivery options at either the Magellan East Houston ("MEH") terminal or the Enterprise Crude Houston ("ECHO") terminal."

"Magellan is pleased to join forces with Enterprise and ICE to offer this leading-edge joint futures contract," said Aaron Milford, Magellan's chief operating officer.

"The new contract improves the transparency, flexibility and marketability of Midland WTI crude oil for Gulf Coast and export customers while maintaining industry-recognized quality and consistency."

Brent Secrest, executive vice president and chief commercial officer of Enterprise's general partner said, "As the market hub for Permian Basin production, Houston represents the most logical choice for a new futures contract. Between Magellan and Enterprise, we offer access to virtually all of the export capacity in the Houston region."

The US typically exports over 3 million bpd of crude.