Library / B 143 Federal Republic of Nigeria Official Gazette No. 52
B 143 Federal Republic of Nigeria Official Gazette No. 52

Page 6 of 31
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4.  The Authority may initiate action for market coupling of a gas exchange
with another exchange, where a commodity, which is produced by utilising
gas as a major input, is traded, to minimise the risk to a producer of such
commodity.
5.  The Authority may extend applicability of these Regulations, with or
without modifications, to derivatives, forward and future contracts in respect
of such commodities and services, and such type of contracts as specified in
these Regulations.
6.  Subject to compliance with applicable laws, the Authority may allow
contracts at the gas exchange denominated in foreign or local currencies.
7.—(1) The Authority shall approve new contracts introduced by the
gas exchange in these Regulations.
(2)  For approval of new contracts, the Authority may examine the
following and other parameters of the new contracts as may be considered
appropriate —
(a)  type of contract such as, intra-day, day-ahead, term-ahead contract
and other like contracts ;
(b)  price discovery methodology and proposed matching rules ;
(c)  transaction period ;
(d)  risk management mechanism ;
(e)  margin mechanism ;
(f )  final price settlement mechanism ;
(g)  gas delivery mechanism ;
(h)  delivery duration ; and
(i)  penalty for contractual deviation.
(3)  The Authority, after granting the gas exchange an opportunity of
being heard, may by order, suspend or withdraw transactions on any contract
from the gas exchange and issue any consequential directive as deemed
necessary.
8.  A gas exchange shall adopt market design and propose contract
specifications, keeping in view the following principles —
(a) price discovery mechanism shall ensure fair, neutral, competitive
and efficient prices ;
(b)  the bidding mechanism may be auction or as continuous ;
(c)  contract design shall be such so as to increase liquidity ; and
(d)  the physical market design and pipeline operations shall comply with
the guidelines and regulations provided by the Authority.
Market
coupling of
gas exchange
Extension of
the
applicability
of these
Regulations
Gas
exchange
contracts
denomination
Approval or
suspension
of contracts
by the
Authority
Principles of
market and
market
design