2024-01-17 22:07:30
The governors posed before meeting at the CFI to analyze the chapter of the Omnibus law that regulates the exploitation of hydrocarbons
The ten governors of the provinces where hydrocarbons are exploited met this afternoon, beyond their political colors, to finish agreeing, as a bloc, on the changes and limits that they seek to introduce in the chapter of Javier Milei’s Omnibus law that reforms the regulation of that industry.
In an extensive, detailed and – in fragments – harsh statement, they listed all the modifications they demand, with the underlying objective that the Government recognizes in the project’s articles that the resources and their exploitation belong to the provinces. In addition, tonight they will send a reformed version of the project to the national Energy Secretary, Eduardo Rodríguez Chirillo, one of the main authors of the libertarian measure, with whom they have been talking privately since the initiative became known.
“Everything has been talked about. We agree with most of the project, but there are important things to review,” a provincial chief said before leaving the building. However, the governors do not put their hands on the fire for the Government. Chirillo showed them good disposition in recent weeks, they say. But, as in the case of the changes in the reform of the Fisheries Law, on which they also requested modifications, they will not be calm until the modifications they demanded are reflected in the text of the project that is being debated in the plenary sessions of commission of Deputies and that the Government seeks to approve in Congress before the end of the extraordinary sessions, on January 31.
The provincial leaders will send their proposal to the Secretary of Energy
The meeting took place for more than two hours at the headquarters of the Federal Investment Center (CFI) on San Martín Street and was attended by almost all the leaders that make up the Federal Organization of Hydrocarbon Producing States (OFEPHI), created 37 years ago to coordinate policies that affect hydrocarbon reserves between the jurisdictions where they are located.
There were the provincial heads of Río Negro, Alberto Weretilneck; from Tierra del Fuego, Gustavo Melella; from Neuquén, Rolando Figueroa (who became the head of Energy and Environment); from Chubut, Ignacio Torres; from La Pampa, Sergio Ziliotto; from Mendoza, Alfredo Cornejo – who connected to the meeting by videoconference, but instructed his Minister of Energy and Environment, Jimena Latorre, to attend in person – and from Jujuy, Carlos Sadir. Meanwhile, Gildo Insfrán, from Formosa, sent his Minister of Economy, Jorge Ibañez; Gustavo Sáenz, from Salta, to his Minister of Mining, Romina Sassarini; and Claudio Vidal, from Santa Cruz, to the head of Energy, Jaime Álvarez.
“We ratify the defense of the original domain of the Provinces over the hydrocarbon resources located in our territories and the powers of administration over them,” begins the serious but severe statement that they signed this afternoon to “achieve a legal framework for the activity that provides greater predictability and improve employment generation.”
Detail of the flags of Argentina and the oil company YPF, in an archive photograph. EFE/Leo La Valle
In the document they did not state a position on the privatization of YPF, one of the most controversial measures that Milei proposed during the campaign and that is not ruled out from the ruling party’s agenda despite the fact that the President said that “for now” it is not in his plans. However, in off-the-record statements at the end of the conclave, some participants let it be known that the common position is against the sale of the national oil company.
In the document they mentioned several technical but vital points for the governors, related to the maintenance of the decision-making prerogatives of each district and the royalties that enter each district. They asked that the model document for the bidding process be “flexible” and “consider criteria that allow it to be adapted to each reality,” as well as make concession deadlines more flexible. In addition, they “totally” rejected the repeal of article 32 of law 17,319, which grants the Provincial Enforcement Authorities control, evaluation and approval of investments. And they requested that the power of the provinces to grant extensions to the expiration date of current concessions not be eliminated.
On the other hand, they asked that mechanisms be considered to ensure free access to processing and transportation facilities to defend free access to markets by smaller producers not integrated into the different basins. And they demanded to keep the determination and payment of royalties in the hands of the concessionaires; and review the articles that establish the values of exploration and exploitation fees and fines, to modify them with schemes and parameters that are updated automatically.
Tenaciously, they disapproved of the article that empowers the Executive to develop environmental legislation for the sector. “Although we can share the ultimate objective, we understand that legislation of this type must arise from the consensus of the parties and not from the will of one level of government over the rest,” they launched. And, in the same sense, they questioned the wording of the point that gives the national government the power to increase, with the argument of “guaranteeing fiscal sustainability”, the rates of export duties on merchandise with a ceiling of 15 percent. hundred. Instead, they requested that the maximum rate to be taxed with export duties on hydrocarbons cannot exceed the 8 percent currently in force.
Finally, they suggested reviewing the article that modifies the Large Investment Incentive Regime (RIGI), because, as they detected in its wording, it rules out hydrocarbon exploitation projects, and they closed with a key demand for their economies: that companies give up mature areas of conventional exploitation that are not being exploited due to “lack of strategic interest” to the provinces, which would benefit from working them.
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