Natural Gas: Allocation, Utilization and Pricing

The Minister of Energy and Natural Resources (“Minister”) has issued Regulation No. 37 of 2015 on Provisions and Procedures for Determining the Allocation, Utilization and Price of Natural Gas(“2015 Regulation”). In bid to ensure the ongoing availability of natural gas for domestic consumption, the 2015 Regulation prioritizes state-owned enterprises, as well as regionally owned enterprises looking to obtain and utilize natural gas. [1] Prior to the 2015 Regulation, similar provisions were stipulated under Ministerial Regulation No. 3 of 2010 on the Allocation and Utilization of Natural Gas for Domestic Needs (“2010 Regulation”).The 2015 Regulation is of relevance to all companies currently involved in or intending to become involved in natural-gas activities.Domestic NeedsThe Minister will directly appoint state-owned enterprises and regionally owned enterprises (located in exploration areas) to explore and utilize natural-gas fields. [2] Note that these companies must prioritize domestic needs by taking the following points into account: [3]