Decrypting the Egyptian Gas Legal Framework

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RES E A RC H & A N A LYS I S

DECRYPTING

THE EGYPTIAN GAS LEGAL FRAMEWORK BY AMINA HUSSEIN, REHAM GAMAL, AND TASNEEM MADI

T

he natural gas activities in Egypt witnessed significant improvements starting in 2015. The government worked on several pillars to take developments, including the legal aspect.

In Egypt, the supply chain in the natural gas market operates under the directionbody, and called the Gas Regulatory Authority (GasReg). The role of G regulatory supervision of the Ministry of Petroleum and Mineral Resources (MoP).regulate, The Egyptian follow up and control all activities related to the natural gas marke natural gas market was first managed by the Egyptian General Petroleum Corporation (EGPC) before moving under the supervision of the Egyptian Natural Gas TheHolding issuance of this law encourages private companies to enter the game of Company (EGAS), according to the US Energy Information Administration’s (EIA) and distributing natural gas to the local market, as reported in the GasReg w Country Analysis Brief: Egypt in 2018. Prior to 2017, the natural gas activities in Egypt were covered by law No. 217 for 1980. Under this law, EGAS was responsible for all operations relating to exporting, transportation, and domestic supply of natural gas to different sectors. Post-2017, the situation changed with the approval of the new Gas Market Law No. 196 for 2017.

I. NATURAL GAS MARKET LEGAL FRAMEWORK

THE NEW GAS MARKET LAW MAIN PROVISIONS

1. NEW GAS LAW Before 2015, the decreasing supply and the growing demand of natural gas forced Introducing “Third Egypt to spend billions to close the supply-demand gap. As a result, the government Party Access decided to liberalize the natural gas market to relieve the budget. In May 2015, the government announced the decision to allow private companies to use the state- Principle” owned national gas grid to import, transfer, and distribute natural gas to the local market.

Identifying the roles, rights & obligations of all parties

MARKET LIBERALIZATION TIMELINE Event

May 2015

Jul. 2017

Declaration of market liberalization decision

Issuance of the new “ Gas Market Law”

Feb. 2018

Issuance of the new law’s executive regulations

2022

Complete natural gas market liberalization

Allowing consumers to freely choose gas suppliers on freely agreed prices

Regulating the downstream activities

2. GASREG

GasReg is an independent authority established by the effect of the new la maintain several objectives, including attracting new investments. In addit the GasReg governs the market’s mechanism for the importing, re-gasifica transportation, distribution, storage of natural gas, as well as setting its own resources and revenue streams, according to the authority’s website.

Thesections. authority further introduces fair competition to the market by allowing “ The new Gas Market Law includes 53 articles, which are divided into five Access” to natural gas infrastructure. This is in addition to increasing th Most importantly, the second section refers to the establishment of anParty independent services along with protecting the consumers’ rights, according to the GasReg

10 EGYPT OIL & GAS NEWSPAPER


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