S&P Global Platts Announces Formal Proposal on Additional Crudes for Dated Brent Benchmark

Possible addition of Norway's Troll grade

LONDON, Dec. 2, 2016 /PRNewswire/ -- S&P Global Platts, the leading independent provider of information and benchmark prices for the commodities and energy markets, is inviting feedback on its proposal for the addition of new crude grades to the Dated Brent benchmark. In particular, Platts is considering the addition of Troll as a deliverable grade into the Dated Brent basket.

Over 2016, the Platts Dated Brent crude basket – composed of the Brent Ninian Blend, Forties, Oseberg and Ekofisk grades – saw healthy available supplies averaging 45 cargoes per month. However, Platts Analytics forecasts production will decline to 20 cargoes of crude per month by 2025.

Platts has been working with market participants on the evolution of North Sea crude for a number of years and held an open methodology session in London on December 2, 2016 at which it announced the opening of a formal consultation regarding the possible inclusion of additional crude oil streams in the basket of crudes reflected in its Dated Brent benchmark to ensure its continued robustness. In particular, Platts is considering the addition of Norway's Troll to the basket of crudes reflected in its Dated Brent FOB North Sea and Dated Brent CIF Rotterdam assessments, as well as its Cash BFOE assessment. Platts invites feedback on these proposals by January 31, 2017.

Troll is a light sweet crude oil grade with a typical production of 10-15 cargoes of 600,000 barrels each month. As is the case with the existing BFOE grades, Troll loads on an FOB basis, from the Mongstad terminal in Norway. It only differs from the rest of the BFOE complex in its acid content. Historically, this has been considered a barrier to adding Troll to the BFOE basket, but the refining pool in Europe has upgraded and diversified over recent years, with many refiners now able to handle crudes like Troll, with only a moderately higher Total Acid Number (TAN) than other BFOE grades.

Jonty Rushforth, Global Editorial Director, Oil and Shipping Price Group, S&P Global Platts said: "Despite stabilizing production across the Dated Brent grades, Platts believes that the addition of one or more FOB crude grades would help to ensure the continued robustness of the Dated Brent FOB benchmark through the availability of additional volumes to the complex".