Price Transparency: Index + Basis Examples at San Juan Pool
(Aelix – Structures That Clear Series)
Price clarity is the first proof of competence.
In wholesale gas, index and basis mean more than numbers, they define accountability.
Every dispute you’ve ever heard started with a mismatch between what someone thought the price meant and what the confirm actually said.
At Aelix, index and basis are never implied. They’re documented, verified, and locked in before nomination.
Index and Basis in Plain English
Index is the published benchmark you price against, for example, Inside FERC San Juan Basin Index.
Basis is the adjustment applied for physical location or transport cost, the difference between the index point and where the gas actually flows.
Aelix defines both explicitly in every confirmation, removing the ambiguity that creeps in when one counterparty says “San Juan” and the other means “El Paso San Juan Pool.”
Where Most Get It Wrong
Confusion doesn’t come from the math. It comes from timing and geography.
- Timing: The publication date of the index and the delivery date of the gas aren’t always the same.
- Geography: One side references a general hub (“San Juan”) while the other uses a specific receipt point (“Blanco Hub” or “El Paso San Juan Pool”).
- Language: Informal confirms say “index plus four and a half cents,” but never specify which index, month, or posting service.
Those errors don’t surface until settlement… when it’s too late to fix.
Aelix’s Approach
We treat price structure like title transfer: every detail recorded, nothing assumed.
- Verified Publication Reference
- Always cite the full publication name (for example, Inside FERC Gas Market Report, San Juan Basin Index – First of Month).
- Defined Basis Location
- Use the recognized point code — El Paso San Juan Pool (EPJ) — not a shorthand.
- Documented Formula
- Example: Index + $0.035 per MMBtu.
- Timestamped Agreement
- Each price confirm is issued the same day as the trade, linked to the trade ID and term window.
- Counterparty Verification
- Confirmation acknowledged electronically; both sides store identical price logic in their systems.
When everything is spelled out, there’s nothing left to argue about.
Anonymized San Juan Pool Specimen (Excerpt)
Confirmation ID: AELX-2025-0412
Trade Date: April 12, 2025
Seller: Aelix LLC
Buyer: Confidential Counterparty (Master Agreement dated 10/03/2023)
Product: Natural Gas – Firm Term Offtake
Delivery Point: El Paso San Juan Pool (EPJ)
Contract Quantity: 30,000 Dth/day
Price: Inside FERC San Juan Basin Index + $0.035
Delivery Period: May 1 – July 31, 2025
Title Transfer: At Delivery Point Authorized Signatory: ____________________
This is what price transparency looks like in practice… every reference defined, every location verifiable.
Why It Matters
Faster Credit Review. Credit teams approve faster when price data matches published sources.
Cleaner Reconciliation. Invoices line up to the cent because the math is identical on both sides.
Better Market Signal. When everyone prices against a verified benchmark, spreads reflect real supply, not confusion.
The Aelix Difference
We don’t negotiate index definitions. We standardize them.
Every confirm that leaves our desk tells both sides the same story the same way.
That’s why our paper settles faster and why our counterparties rarely need clarification.
TL;DR
At Aelix, price transparency isn’t negotiation… it’s verification.
Every confirm shows the index source, basis location, and timing that make the deal executable.
Next Step
See how Aelix structures price clarity from index to invoice. Schedule a 15-minute alignment call to benchmark your confirm format against ours.
