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E-Trader Altra Energy Gets Financial Equity Boost from Conoco

E-Trader Altra Energy Gets Financial Equity Boost from Conoco

Altra Energy Technologies Inc. got a financial boost last week from Conoco Inc., which made an undisclosed equity investment in the Houston-based electronic trading system. Conoco was already using Altra systems for some of its end-to-end natural gas and natural gas liquids electronic trading and transaction processing and natural gas pipeline operations management systems.

So far this year, Conoco has made three equity investments in the growing e-commerce market. In April, Conoco was one of 14 founders of a global procurement exchange for energy and petrochemical companies, and also made an equity investment in HoustonStreet Exchange for wholesale trading of crude oil, refined products and natural gas through its trading site, HoustonStreet.com.

Mike Johnson, Conoco's vice president for natural gas and gas products, said the investment will help the Houston-based company to "substantially increase" its volume of electronic transactions for all of its energy commodities.

"Altra's commitment is to provide a quality product and service that connects the trading clearinghouse to the transactional requirements of the commodity itself," Johnson said. He said that for natural gas trading systems, Altra offers the industry's first mid-office and back-office support.

AEP, BP Amoco and Koch Industries have already made investments in the Houston-based company, and Altra executive vice president Mark Crosno said that Conoco was a "good fit" with its existing energy investment participants.

"Conoco's investment in Altra is yet another vote of confidence in our trading systems and supporting transaction management solutions, and in the growing adoption of online trading," Crosno said.

Bill Mohl, Altra's vice president of commercial operations, said that the volume of trading in the second quarter was flat compared with the first quarter, but said that the number of trades was up.

"We saw the volume of trades down, but the number of trades up by 25%," Mohl said. He attributed his company's steady growth to the "market makers" like Conoco, which he said have "made a big difference in attracting other businesses to the service."

Other competitors entering the market have made a difference, he said, but "nobody out there has real liquidity." Altra now faces competition from new startups like powerhouse online EnronOnline, already considered the world's leading online trader based on revenue despite the few months it's been in the marketplace, and Coralconnect (see NGI, May 22).

Mohl said he "truly believes" that e-commerce will provide more trading in the years to come, especially as the volatility of the market settles down. "We've seen the power trading up in July, and I'd say that e-trading is here to stay."

Along with garnering strong energy industry support, Altra continues to take in technology honors. For the second year in a row, it is listed in Red Herring magazine's "Top 100" technology companies, and in May it was named by AMR Research as the world's No. 1 business-to-business independent trading exchange. Altra was formed only four years ago by Williams and the former PanEnergy (now Duke Energy), and was one of the very first online trading systems for natural gas.

Carolyn Davis, Houston

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