Oil Potentates Join Forces To Launch A Blockchain Platform
Shell, BP and other firms from energy industry team up to develop a blockchain platform. The development will modernize commodities trading.
Last week, we reported on other companies have joined Maersk and IBM to TradeLens project. Now, oil moguls will implement the blockchain technology for their own use.
To automate post-trade processes
VAKT Global is responsible for building the platform. On Monday, the company revealed the news during a digital commodities summit, organized by S&P Global Platts.
Lyon Hardgrave, vice president of product development at VAKT Global, said:
“We expect to go live at the end of November in the North Sea oil market. In 2019 we will look at ARA barges, waterborne markets and US crude pipelines. And by January we expect the first licensees will come on board, in addition to our shareholders.”
The platform will help digitize paper-based traditional contracts and operating documentation using smart contracts. The development will cut costs, reduce the risk of any errors and make trading more reliable and efficient.
Shell and BP will take part in the program in cooperation with Equinor, Gunvor, ABN AMRO, ING, Koch and others.
Hardgrave claims that the platform won’t be for settlements or trading, it will only be for post-trade resolution. However, the vice president doesn’t exclude using blockchain to settle and to trade in the future.
At the summit, blockchain technology experts constituted the vast majority. One of them, David Shrier is convinced that the entire commodity trade ecosystems will be digitized in seven to ten years.
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