After going live exactly one year ago, online commodity marketplace, IntercontinentalExchange (ICE) reported that more than 250,000 trades have been transacted on its system with a total notional value of over $400 billion. The Atlanta, GA-based company said the first full year of trading for its full spectrum of over-the-counter (OTC) energy and metals products is marked with “impressive levels of liquidity, price transparency and rapidly growing volumes.”

“It has been a phenomenal first year for us with more than a quarter million trades and accelerating growth,” said Jeffrey Sprecher, CEO of IntercontinentalExchange. “More than half of these transactions were completed in the past four months alone showing that our formula is working and that we have a highly liquid and transparent platform that ensures smooth trading around the clock.”

Compared to its competition, ICE appears to be holding up. After capping its first full year of operation in 2000, EnronOnline reported that it had executed 548,000 transactions with a gross value of $336 billion. Natural gas sales and related business on EnronOnline grabbed a large chunk of earnings for Enron Corp. as well, with revenue jumping to $40.8 billion from $11 billion a year earlier. EnronOnline said earlier this year that it was doing approximately 3,000 trades a day.

In an August survey conducted by Energy Argus of 40 power traders, the company said ICE had gained “an equal footing” with EnronOnline in less than 10 months (see Daily GPI, Aug. 24). From the survey, EOL was shown to hold 39% of the power market, while ICE came in second with a 37% share. However, Energy Argus estimated that EOL performed 1.3 million trades during the second quarter 2001 with a value of $228 billion, while ICE did 155,000 trades with a value of $14 billion for the same time period.

“With our recent acquisition of the International Petroleum Exchange (IPE) and our forthcoming OTC clearing services through the London Clearing House (LCH), we will soon be the world’s first exchange organization to offer market participants a full spectrum of risk management products ranging from traditional bi-lateral OTC agreements to cleared OTC products to exchange-traded futures and options on futures,” added Sprecher.

Volumes after ICE’s first year of production include:

“Equally exciting is the rapid rate of acceptance by the North American power and gas markets of the ICE daily price indices that we launched at the end of July,” said Sprecher. “We believe this reflects the industry’s overriding desire to have unbiased indices based on actual, verifiable transactions and published in the most timely manner possible. Financial instruments settling on these indices have been active in the voice broker market for some time. As a result of this demand, we recently added these swaps for trading on the exchange and early activity is very encouraging.” He added that the ICE price indices are available on its web site at www.intcx.com to users and non-users alike.

Acquired by ICE last summer, volumes on the IPE during the same period reached the following levels:

ICE said that market participation continues to expand at a rapid rate, which currently includes over 365 of the world’s largest energy and financial commodity firms making it one of the most widely distributed online professional marketplaces in the world. In addition, ICE said over 300 customers in over 30 countries use IPE’s markets on a regular basis.

“One major driver for our growth and success is that we operate an open system that can be easily accessed and used by any commercial participant in the OTC commodity market at any time,” added Sprecher. “Every user has equal access to viewing, posting and acting on prices, subject to credit, which is arranged bilaterally with every other user on the exchange.”

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