• Specification Amendment to Grade and Quality Specification of NYMEX New York Harbor ULSD Heating Oil Futures Contract Beginning with the May 2013 Contract Month and Beyond

      • To
      • Members, Member Firms and Market Users
      • From
      • Research & Product Development and Products & Services
      • #
      • SER-6625
      • Notice Date
      • 11 April 2013
      • Effective Date
      • 11 April 2013

    • Effective starting with deliveries against the May 2013 contract month and beyond, and pending all relevant CFTC regulatory review periods, the New York Mercantile Exchange, Inc. (NYMEX or Exchange) will amend the contract specifications for its New York Harbor ULSD Heating Oil Futures contract (commodity code HO, chapter 150) under NYMEX Rule 150101.B and 150105 to provide additional clarification related to administrative requirements for deliveries of on-road Ultra Low Sulfur Diesel (ULSD) against the New York Harbor ULSD Heating Oil Futures contract. These rule amendments are set forth to ensure that deliveries shall comply with Colonial Pipeline’s specifications for Grade 62 for on-road diesel, including the requirement that the on-road ULSD must contain no renewable diesel or biodiesel. In addition, at the time of delivery, the seller will be required to provide the buyer a Product Transfer Document, and shall make available to the Exchange upon request any additional information to verify tracking of the product from receipt at origin to seller’s facility.

      The rule amendment reflecting the revised grade and quality specifications (effective with the May 2013 contract month and beyond) is presented in black-line format below.

      (bold/underline indicates addition; strikethrough indicates deletion)

      Chapter 150

      New York Harbor ULSD Heating Oil Futures

      150101.B. Grade and Quality Specification Effective with the May 2013 Contract Month and Beyond – Ultra Low Sulfur Diesel ("ULSD")

       

      The oil delivered shall be a pure hydrocarbon oil free from renewable fuel, biodiesel, alkali, mineral acid, grit, fibrous or other foreign matter, meeting the "Delivery" specifications of the Colonial Pipeline's Fungible Grade 62 for Ultra Low Sulfur Diesel, and being properly designated for sale in New York Harbor in accordance with U.S. Environmental Protection Agency (EPA) regulations. Delivery test results may vary by the smaller of ASTM reproducibility for a given test or any test tolerance as allowed for downstream parties by state or EPA regulations at the point of delivery. The ULSD delivered shall fully comply with specifications of the Colonial Pipeline Fungible Grade 62 for on-road ULSD, including the requirement that the on-road diesel fuel must contain no renewable diesel or biodiesel.

      150105. DELIVERY

      Delivery shall be made free-on-board ("F.O.B.") seller's ex-shore facility in New York Harbor with all duties, entitlements, taxes, fees and other charges imposed prior to, or as a result of, delivery paid by the seller. Delivery shall be made in accordance with applicable Federal, State and local laws. Buyer shall reimburse seller for any heating oil tax as had been or will be paid by the seller. At buyer's option, such delivery shall be made by any of the following methods:

      1. By delivery into buyer's barge;

      2. By delivery into buyer's tanker or pipeline, if buyer can take delivery in such manner at the facility used by seller;

      3. By stock transfer of title to the buyer; if the facility used by seller allows such transfer;

      4. By book transfer if the seller agrees to such transfer;

      5. By intra-facility transfer ("pump-over"), if the facility used by seller allows such transfer; or

      6. By inter-facility transfer ("pump-over"), if both facilities used by seller and buyer allow such transfer.

      For purposes of these rules, any seller delivering an aggregate of twenty-five (25) contracts or less in a delivery month, shall deliver all such contracts into the same facility.

      On-road ULSD Designation: At the time of delivery, the seller shall provide the buyer a Product Transfer Document, and shall make available to the Exchange such documentation and any additional information as may be required by the Exchange upon request, including documentation that will verify tracking of the product from receipt at origin to seller’s facility.

      For the purpose of these rules, New York Harbor shall extend from the East River west of Hunts Point; Gowanus Bay west of the Hamilton Avenue Bridge; the Hudson River south of the George Washington Bridge; the Upper Bay; the Narrows; the Lower Bay west of Morton Point; the Newark Bay; the Hackensack River south of the Witt-Penn Bridge; the Passaic River south of the Pulaski Skyway Bridge; the Kill Van Kull; the Arthur Kill and the Raritan River east of the Garden State Parkway Bridge.

      　

      Please refer questions on this subject to:

      Research and Product Development

      Dan Brusstar

      Daniel.Brusstar@cmegroup.com 212.299.2604Howard.Hopkins@cmegroup.com 212.299.2351

      Products and Services

      Howie Hopkins

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