News Release

Exchange Announces Margin Changes for Natural Gas Basis Swap Futures Contracts

Fri Oct 28 2005

NEW YORK, N.Y., October 28, 2005 — The New York Mercantile Exchange, Inc., announced today it would change the margins for its natural gas basis swap futures contracts at the close of business on October 31.

Margins on the first month of the Alberta basis swap futures contract will increase to $1,500 from $700 for clearing members, to $1,650 from $770 for members, and to $2,025 from $945 for customers. Margins on the second month will increase to $650 from $350 for clearing members, to $715 from $385 for members, and to $878 from $473 for customers. The margins on the third to sixth months will increase to $500 from $200 for clearing members, to $550 from $220 for members, and to $675 from $270 for customers. Margins on the seventh to 12th months will increase to $300 from $125 for clearing members, to $330 from $138 for members, and to $405 from $169 for customers. The margins on all other months will increase to $200 from $100 for clearing members, to $220 from $110 for members, and to $270 from $135 for customers.

Margins on the first month of the Chicago basis swap futures contract will increase to $800 from $600 for clearing members, to $880 from $660 for members, and to $1,080 from $810 for customers. The margins on all other months will increase to $200 from $125 for clearing members, to $220 from $138 for members, and to $270 from $169 for customers. Margins on the first month of the San Juan basis swap futures contract will increase to $1,100 from $850 for clearing members, to $1,210 from $935 for members, and to $1,485 from $1,148 for customers. All other months will remain the same.

The margins on the first month of the SoCal basis swap futures contract will increase to $1,100 from $900 for clearing members, to $1,210 from $990 for members, and to $1,485 from $1,215 for customers. All other months will increase to $550 from $475 for clearing members, to $605 from $523 for members, and to $743 from $641 for customers.

Margins on the first month of the Transco Zone 6 basis swap futures contract will increase to $600 from $350 for clearing members, to $660 from $385 for members, and to $810 from $473 for customers. Margins on the second month will incur no changes. The margins on the third to sixth months will increase to $1,000 from $800 for clearing members, to $1,100 from $880 for members, and to $1,350 from $1,080 for customers. Margins on the seventh to 12th months will increase to $200 from $150 for clearing members, to $220 from $165 for members, and to $270 from $203 for customers. The margins on all other months will remain the same.

Margins on the first month of the Northwest Pipeline, Rockies basis swap futures contract will increase to $1,100 from $750 for clearing members, to $1,210 from $825 for members, and to $1,485 from $1,013 for customers. Margins on the second month will increase to $800 from $500 for clearing members, to $880 from $550 for members, and to $1,080 from $675 for customers. Margins on all other months will remain the same.

Margins on the first month of the Panhandle basis swap futures contract will increase to $1,100 from $900 for clearing members, to $1,210 from $990 for members, and to $1,485 from $1,215 for customers. Margins on all other months will remain the same.

Margins on the first month of the Permian basis swap futures contract will increase to $1,400 from $1,200 for clearing members, to $1,540 from $1,320 for members, and to $1,890 from $1,620 for customers. Margins on all other months will increase to $700 from $500 for clearing members, to $770 from $550 for members, and to $945 from $675 for customers.

Margins on the first month of the Texas Eastern Zone M-3 basis swap futures contract will increase to $700 from $325 for clearing members, to $770 from $358 for members, and to $945 from $439 for customers. Margins on all other months remain the same.

Margins on the first month of the NGPL Tex/OK basis swap futures contract will increase to $1,100 from $750 for clearing members, to $1,100 from $825 for members, and to $1,350 from $1,013 for customers. Margins on all other months will increase to $500 from $300 for clearing members, to $550 from $330 for members, and to $675 from $405 for customers.

Margins on the first month of the ANR Oklahoma basis swap futures contract will increase to $1,200 from $1,000 for clearing members, to $1,320 from $1,100 for members, and to $1,620 from $1,350 for customers. The margins on all other months will increase to $600 from $425 for clearing members, to $660 from $468 for members, and to $810 from $574 for customers.

Margins on the first month of the Sumas basis swap futures contract will increase to $1,200 from $1,000 for clearing members, to $1,320 from $1,100 for members, and to $1,620 from $1,350 for customers. Margins on all other months will increase to $700 from $575 for clearing members, to $770 from $633 for members, and to $945 from $776 for customers.

Margins on the first month of the NGPL Mid-Continent basis swap futures contract will increase to $1,200 from $900 for clearing members, to $1,320 from $990 for members, and to $1,620 from $1,215 for customers. The margins on all other months will increase to $500 from $250 for clearing members, to $550 from $275 for members, and to $675 from $338 for customers.

The margins on the first month of the Northern Natural Gas Demarcation basis swap futures contract will increase to $1,300 from $850 for clearing members, to $1,430 from $935 for members, and to $1,755 from $1,148 for customers. Margins on all other months will increase to $400 from $275 for clearing members, to $440 from $303 for members, and to $540 from $371 for customers.

Margins on the first month of the Northern Natural Gas Ventura, Iowa basis swap futures contract will increase to $1,300 from $750 for clearing members, to $1,430 from $825 for members, and to $1,755 from $1,013 for customers. Margins on all other months will increase to $500 from $350 for clearing members, to $550 from $385 for members, and to $675 from $473 for customers.

The margins on the first month of the CIG Rockies basis swap futures contract will decrease to $1,200 from $1,800 for clearing members, to $1,320 from $1,980 for members, and to $1,620 from $2,430 for customers. Margins on the second month will increase to $600 from $500 for clearing members, to $660 from $550 for members, and to $810 from $675 for customers. Margins for all other months will remain unchanged.

Margins on the first month of the Waha basis swap futures contract will increase to $1,300 from $1,100 for clearing members, to $1,430 from $1,210 for members, and to $1,755 from $1,485 for customers. Margins on all other months will increase to $600 from $350 for clearing members, to $660 from $385 for members, and to $810 from $473 for customers.

Margins on the first month of the Tetco Eastern South/STX basis swap futures contract will increase to $900 from $400 for clearing members, to $990 from $440 for members, and to $1,215 from $540 for customers. Margins on the second month will increase to $650 from $250 for clearing members, to $715 from $275 for members, and to $878 from $338 for customers. The margins on the third to sixth months will increase to $500 from $200 for clearing members, to $550 from $220 for members, and to $675 from $270 for customers. Margins on the seventh to 12th months will increase to $400 from $150 for clearing members, to $440 from $165 for members, and to $540 from $203 for customers. Margins on all other months will increase to $200 from $125 for clearing members, to $220 from $138 for members, and to $270 from $169 for customers.

Margins on the first month of the Transco Zone 3 basis swap futures contract will increase to $250 from $180 for clearing members, to $275 from $338 for members, and to $338 from $243 for customers. Margins on the second to 12th months will increase to $200 from $75 for clearing members, to $220 from $83 for members, and to $270 from $101 for customers. The margins on all other months will remain the same.

Margins on the first month of the Tennessee, Zone 0 basis swap futures contract will increase to $900 from $400 for clearing members, to $990 from $440 for members, and to $1,215 from $540 for customers. Margins on all other months will increase to $600 from $300 for clearing members, to $660 from $330 for members, and to $810 from $405 for customers.

The margins on the first month of the Tennessee, LA 500 basis swap futures contract will increase to $150 from $100 for clearing members, to $165 from $110 for members, and to $203 from $135 for customers. Margins on all other months will increase to $100 from $75 for clearing members, to $110 from $83 for members, and to $135 from $101 for customers.

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