Singapore Exchange said on Monday that European trading house Trafigura and locally based Pavilion Gas made the first trade of a just-launched derivatives contract for liquefied natural gas (LNG).

The transaction, worth some $50,000, was based on Singapore's weekly spot price index for Asian LNG which is calculated on contributions from 20 major physical market participants, including buyers, sellers and traders.

The spot price index, known as Singapore SLInG, has been published since last year, with the derivatives contract being launched.

Trafigura and Pavilion traded a total of 10,000 million British thermal units (mmBtu) of free-on-board (FOB) LNG swaps for March, SGX said.

The volume of Monday's sole trade was done at the smallest lot allowed by the contract and represents a fraction of a standard physical LNG cargo.

The new LNG contract is part of a bid by Singapore to become a regional hub of trade of the fuel and break a decade-long reliance on oil-linked pricing.

The head of Trafigura in Asia-Pacific, Tan Chin Hwee, called the launch an "important step in the evolution of the LNG market" and said it would reduce risk in the Asian LNG market.

SGX will compete with CME Group, which began development and clearing of a Japanese LNG contract last year.

Japan is the world's largest importer of LNG, while Singapore sits at the intersection of seaborne LNG trade passing through the Malacca Strait.