One lifecycle, four commodities, two countries.
Every ETRM demo shows a deal becoming an invoice. This is what happens in between, and why a system configured for one commodity, or one side of the border, breaks on the next.
From deal to settlement
Eight stages every program has to configure, read across the four commodities.
| Stage | Crude oil | Natural gas | NGLs | Refined products |
|---|---|---|---|---|
Unit and price basis What is being traded, and in what? | Barrels in the US. In Canada, often priced per barrel in US dollars but nominated, measured and reported in cubic metres. | MMBtu in the US. Gigajoules in Canada, priced in Canadian dollars, with volumes reported in thousands of cubic metres. | Gallons at US hubs, priced per component. Canadian barrels traded by component or as mix, with a spec or raw-mix distinction that changes everything downstream. | Gallons in the US. Litres at a Canadian rack, cubic metres or barrels in bulk. One product can carry three units between pipeline and truck. |
Trade cycle When is the deal struck, and for what period? | Monthly. The physical trade month closes around pipeline nomination deadlines, and price usually settles against a calendar-month average plus a differential. | Daily and monthly. A monthly baseload deal struck in bid week, plus daily spot, all measured against a gas day that is not a calendar day. | Monthly and spot, with seasonal weight. Propane contracts are built around the winter draw. | Pipeline cycles for bulk, daily for the rack. A bulk barrel is scheduled cycles ahead; the same product at the rack is priced every morning. |
Scheduling and nominations How does the molecule get a place on the system? | Monthly nominations per pipeline. Over-nomination triggers apportionment, and the barrels that do not fit need a new home before the month starts. | Standard nomination cycles through the day, each confirmed between operators. A late change is a new nomination, not an edit. | Batch or fungible depending on the pipeline, plus fractionation capacity that has to be booked alongside transport. | Batched and sequenced by grade. Interfaces create transmix, line fill has to be owned by someone, and terminal allocations ration the rack. |
Quality and valuation What changes the value after the deal is priced? | Gravity and sulphur. Commingled streams are adjusted between shippers through a quality equalization or quality bank process, settled after the fact. | Heat content converts volume to energy. Processing adds shrink, fuel and plant allocation, and the contract type decides who carries the liquids value. | Valued by component. A mix barrel is worth the sum of its parts after fractionation fees, which the ETRM has to model, not just record. | Grade and season. Vapour pressure transitions, blending at the rack, and compliance credits that attach to or detach from the barrel. |
Actualization What document says it actually moved? | Run tickets and pipeline statements. Truck tickets into terminals and batteries. In Canada, volumetric submissions that have to reconcile to both. | Pipeline and plant measurement statements, with prior-period adjustments arriving months after the invoice went out. | Fractionator statements by component, pipeline statements, and rail tickets, rarely on the same calendar. | Pipeline delivery tickets, terminal throughput reports and bills of lading from the rack. |
Inventory Where is it, and whose is it? | Tank inventory, line fill and in-transit barrels, corrected to a standard temperature. Shipper line fill is capital most books forget. | Storage balances and pipeline imbalances. An imbalance is inventory with a penalty attached. | Cavern storage held by component, with a seasonal build and draw that sets the propane position. | Terminal tanks by grade and owner, exchange balances owed in both directions, transmix, and a book-to-physical gain or loss. |
Settlement Where does the money disagree with the deal? | Netting across buy/sell counterparties, differential and roll adjustments, and equalization settled a month or more later. | Transport demand and commodity charges, fuel, imbalance cash-outs, and prior-period adjustments re-opening a closed month. | Component pricing against fractionation and transport fees, often from the same counterparty on different statements. | Exchange differentials for location, grade and time. Excise and fuel taxes by jurisdiction. Credits reported separately from the barrels that generated them. |
The spreadsheet What lives outside the system in most programs? | The apportionment and line fill workbook. | The imbalance and prior-period adjustment tracker. | The component balance by fractionator. | The exchange balance tracker. |
- Crude oil
- Barrels in the US. In Canada, often priced per barrel in US dollars but nominated, measured and reported in cubic metres.
- Natural gas
- MMBtu in the US. Gigajoules in Canada, priced in Canadian dollars, with volumes reported in thousands of cubic metres.
- NGLs
- Gallons at US hubs, priced per component. Canadian barrels traded by component or as mix, with a spec or raw-mix distinction that changes everything downstream.
- Refined products
- Gallons in the US. Litres at a Canadian rack, cubic metres or barrels in bulk. One product can carry three units between pipeline and truck.
- Crude oil
- Monthly. The physical trade month closes around pipeline nomination deadlines, and price usually settles against a calendar-month average plus a differential.
- Natural gas
- Daily and monthly. A monthly baseload deal struck in bid week, plus daily spot, all measured against a gas day that is not a calendar day.
- NGLs
- Monthly and spot, with seasonal weight. Propane contracts are built around the winter draw.
- Refined products
- Pipeline cycles for bulk, daily for the rack. A bulk barrel is scheduled cycles ahead; the same product at the rack is priced every morning.
- Crude oil
- Monthly nominations per pipeline. Over-nomination triggers apportionment, and the barrels that do not fit need a new home before the month starts.
- Natural gas
- Standard nomination cycles through the day, each confirmed between operators. A late change is a new nomination, not an edit.
- NGLs
- Batch or fungible depending on the pipeline, plus fractionation capacity that has to be booked alongside transport.
- Refined products
- Batched and sequenced by grade. Interfaces create transmix, line fill has to be owned by someone, and terminal allocations ration the rack.
- Crude oil
- Gravity and sulphur. Commingled streams are adjusted between shippers through a quality equalization or quality bank process, settled after the fact.
- Natural gas
- Heat content converts volume to energy. Processing adds shrink, fuel and plant allocation, and the contract type decides who carries the liquids value.
- NGLs
- Valued by component. A mix barrel is worth the sum of its parts after fractionation fees, which the ETRM has to model, not just record.
- Refined products
- Grade and season. Vapour pressure transitions, blending at the rack, and compliance credits that attach to or detach from the barrel.
- Crude oil
- Run tickets and pipeline statements. Truck tickets into terminals and batteries. In Canada, volumetric submissions that have to reconcile to both.
- Natural gas
- Pipeline and plant measurement statements, with prior-period adjustments arriving months after the invoice went out.
- NGLs
- Fractionator statements by component, pipeline statements, and rail tickets, rarely on the same calendar.
- Refined products
- Pipeline delivery tickets, terminal throughput reports and bills of lading from the rack.
- Crude oil
- Tank inventory, line fill and in-transit barrels, corrected to a standard temperature. Shipper line fill is capital most books forget.
- Natural gas
- Storage balances and pipeline imbalances. An imbalance is inventory with a penalty attached.
- NGLs
- Cavern storage held by component, with a seasonal build and draw that sets the propane position.
- Refined products
- Terminal tanks by grade and owner, exchange balances owed in both directions, transmix, and a book-to-physical gain or loss.
- Crude oil
- Netting across buy/sell counterparties, differential and roll adjustments, and equalization settled a month or more later.
- Natural gas
- Transport demand and commodity charges, fuel, imbalance cash-outs, and prior-period adjustments re-opening a closed month.
- NGLs
- Component pricing against fractionation and transport fees, often from the same counterparty on different statements.
- Refined products
- Exchange differentials for location, grade and time. Excise and fuel taxes by jurisdiction. Credits reported separately from the barrels that generated them.
- Crude oil
- The apportionment and line fill workbook.
- Natural gas
- The imbalance and prior-period adjustment tracker.
- NGLs
- The component balance by fractionator.
- Refined products
- The exchange balance tracker.
Where the border changes the system
A US-built configuration assumes things about title, units, hubs and regulators that do not hold in Canada. These are the ones that surface during design, or worse, after go-live.
At the lease. A first purchaser takes title at the tank battery, pays owners through division orders, and remits severance tax to the state.
Both, with different machinery. Marketers buy at the wellhead and battery, truck or gather the barrels and aggregate them at terminals, then sell into a commingled stream at Edmonton or Hardisty. Quality is not priced on the ticket: it is settled afterwards through industry equalization, which applies at pipelines, batteries and truck terminals alike. Alberta takes Crown royalty on conventional crude in kind and markets it at the same hubs.
Barrels at 60°F. MMBtu for gas.
Cubic metres at 15°C. Gigajoules for gas, thousands of cubic metres for volume.
WTI at Cushing and Gulf Coast grades, priced on calendar-month averages.
Hardisty and Edmonton streams priced as differentials to WTI. The currency and the index are rarely the same as the reporting.
Henry Hub is a physical location with pipelines meeting at it.
NIT is a notional pool on the NGTL system, not a physical point. Dawn in Ontario is a physical storage hub.
FERC for interstate pipeline tariffs, state regulators inside state lines.
The Canada Energy Regulator for interprovincial and international pipelines, the AER inside Alberta, and Petrinex for volumetric and royalty reporting.
API measurement standards, written into contracts and tariffs.
AER Directive 017 for upstream and midstream measurement in Alberta, and Measurement Canada where custody transfer is a trade measurement.
RINs under the federal Renewable Fuel Standard, plus state low carbon fuel programs.
Credits under the federal Clean Fuel Regulations, plus provincial programs such as BC’s low carbon fuel requirements.
None of this is exotic to the people who schedule and settle it. It is exotic to a requirements document written from a vendor’s demo. If your program is being designed from one, that is where we start.
Start with a 45-minute briefing.
Bring the program, the proposal or the month-end that will not close. We will tell you honestly where to start.