Authorities announce the opening of Shanghai Petroleum and Natural Gas Exchange on Nov 26. The exchange, located in Shanghai's financial hub Lujiazui, serves as a national trading platform for energy products such as natural gas, liquefied petroleum gas, and petroleum. [Photo/Xinhua]

The Shanghai Petroleum and Natural Gas Exchange was inaugurated in Lujiazui, part of the Shanghai free trade zone (FTZ), on Nov 26 after a year-long trial operation.

The exchange will serve as a national trading platform for energy products such as natural gas, liquefied petroleum gas, and petroleum.

Registered in Shanghai FTZ on March 4, 2015 with 1 billion yuan ($144.5 million) in registered capital, the exchange has a large number of backers including China National Petroleum Corp, Sinopec Group, China National Offshore Oil Corp, and Shenergy Group.

The trading center will build a comprehensive service system for petroleum and gas trade, clearing and settlement, and aims to develop into a petroleum and gas trading and pricing center for the Asia-Pacific region.

Wang Yilin, chairman of China National Petroleum Corp, speaks at the launch ceremony of Shanghai Petroleum and Natural Gas Exchange on Nov 26. [Photo provided to chinadaily.com.cn]

As of its trial operation on July 1, 2015, the center has consistently posted impressive trading figures. Its bilateral trading volume for pipeline gas has reached nearly 15.4 billion cubic meters and that of liquefied natural gas has amounted to 1.32 million tons in the first 10 months. The bilateral trading volume of natural gas is expected to exceed 30 billion cubic meters in 2016.

The launch of such a trading center is considered beneficial to facilitating reform in China's energy industry, and increasing the global influence of Shanghai's energy market, according to Yang Xiong, mayor of Shanghai.

Wang Yilin, chairman of China National Petroleum Corp, said that as a fair and open trading platform, the center can show the seasonal and regional characteristics of the country's natural gas consumption. It will also help to determine the market value of national gas. Wang also vowed full support to help the center launch a natural gas futures business.

Wang Yupu, chairman of Sinopec Group, said that the center is a necessity in the industry and that the company will help to push future development.