The centuries-old, paper-based trading process of the oil and gas industry is getting overhauled, courtesy of the blockchain and an industry consortium including Shell, BP, ABN Amro, ING, and Societe Generale.
The world leading energy producers and banks joined forces earlier this month, and today launched a new blockchain-based trading platform for physical oil trades, reports the Financial Times.
Based on JP Morgan’s Quorum blockchain, the platform is in fact the first functional blockchain trading platform for the oil and gas industry.
The consortium and platform, both formally known as VAKT, includes a range of energy firms and banks included BP, Royal Dutch Shell, Gunvor, Mercuria, Koch Supply and Trading, ABN Amro, ING, and Societe Generale.
Traditionally, the buying and selling of commodities is paper-based, meaning that credit notes and invoices have to be completed manually, and then emailed, faxed, or even posted to the relevant parties.
According to the report, VAKT believe that putting the process on the blockchain will make it a faster, cheaper, and more secure way of trading commodities.
Initially, the VAKT platform will only be available to the members of the consortium, but it is pegged for release to the wider market in January 2019.