Country
Assessment
Article 16 of Law No. 002/2019 refers to an institutional structure composed of the Ministry of Petroleum, Gas, Hydrocarbons, and Mines (Ministère du Pétrole, du Gaz, des Hydrocarbures et des Mines [MPGHM]), a regulatory authority, a national operator, and advisory bodies: Article 17 states that the ministry in charge of hydrocarbons (MPGHM) is the competent authority ensuring implementation of the government’s policy on the upstream and downstream oil and gas industry. Article 18 states that the application of the regulations governing the upstream, midstream, and downstream oil and gas sectors is to be carried out by the ministry department in charge of hydrocarbons, currently the General Directorate of Hydrocarbons (Direction Generale des Hydrocarbures [DGH]). Article 28 defines the responsibilities of an independent administrative authority in the oil and gas sector (responsibilities currently with DGH), which include the following: guaranteeing free competition in the oil and gas sector, per the Central African Economic and Monetary Community (Communauté Économique et Monétaire de l’Afrique Centrale) code on anti-corruption contributing to the development of technical specifications in the oil and gas sector and ensuring operators’ compliance with technical, quality, hygiene, health, and environmental specifications, as defined in the legislation guaranteeing pricing transparency and nondiscriminatory third-party access to essential infrastructure. Article 27 reiterates the right of the National Hydrocarbons Company (Société Nationale des Hydrocarbures) to participate in exploiting, marketing, and distributing hydrocarbons and their associated products. Founded in 2011, the National Hydrocarbons Company—also known as the Gabon Oil Company—reports to the President’s Office and is under the technical supervision of the MPGHM and the financial supervision of the Ministry of Economy. The new law no longer expressly refers to this company as the national operator. The Gabon Oil Company is defined only as an operator whose capital is held exclusively by the state. Its functions include the following: holding the government’s interests in national hydrocarbon resources and shares in private companies investing on behalf of the state (alone or in joint ventures with private companies) in upstream or downstream oil and gas projects undertaking any activity in the oil and gas supply chain, with the same rights and obligations as any other operator entering into agreements with the state, in the same way as private companies, to operate new gas-processing facilities and pipeline infrastructure, potentially in a joint venture with private operators.
Article 125 of Law No. 002/2019 prohibits the flaring and venting of gas in Gabon. No evidence of situations exempt from this general prohibition without government approval could be found in the sources consulted. However, at the request of the contractor, the environmental authority can authorize flaring and venting for a period.
Article 126 of Law No. 002/2019 requires operators to submit a gas flaring reduction plan for all their production fields for the joint approval of the MPGHM and the Ministry of Environment.
Article 127 of Law No. 002/2019 requires operators to equip production facilities with flare measuring devices. Article 248 requires that the ministry responsible for hydrocarbons approve the choice, location, installation, modification, and addition of any equipment for measuring and metering oil and gas production. Article 127 requires operators to report the volumes of gas flared to the ministry responsible for hydrocarbons. Failure to declare any volume of gas flared subjects the operator to a fine, the amount of which will be set by regulation in the future. Article 119 states that contractors are required to transmit to the DGH all information relating to the gas balance in accordance with the procedures to be set by future regulation. Article 182 mandates that all hydrocarbon permit holders provide the DGH with a report on its activities and any administrative, technical, economic, and financial information related to its operational responsibility, quality, health, and the environment under the conditions and time required by the regulations. The model PSC states that any flared volumes must be reported to the DGH monthly.
Article 11 of ESDM 17/2021 requires contractors or processing business permit holders to identify flared volumes. They can do so using measurement instruments, mass balance calculations, or other engineering calculations that follow good technical rules.
No evidence regarding monetary penalties could be found in the sources consulted.
Article 19 of ESDM 17/2021 calls for administrative penalties in case of noncompliance with these regulations (Article 19, Paragraph 1, lists specific clauses). Administrative penalties start with a written warning and escalate to cancellation of the appointment of the offending firm’s head of engineering if the written warning is not followed up within a month, and then to temporary suspension of production activities if the head of engineering remains in place after another month. Article 10 of ESDM 32/2017 allows SKK Migas to revoke the flare gas allocation from the selected bidder if it fails to commence work within three months following the award or fails to start production within 12 months. However, there are no known cases of revocation.
The only performance standard identified is to start production and the utilization of flare gas within 12 months of the award date in the bid rounds conducted by SKK Migas (for gas being flared). There is no mention of an emission standard to be achieved.
No evidence regarding fiscal and emission reduction incentives could be found in the sources consulted. According to Article 20 of ESDM 17/2021 , the minister gives annual awards to contractors or processing business permit holders that optimize flare gas management. The award criteria is stipulated by DG Migas (Article 21).
ESDM 30/2021 calls for contractors to pursue the utilization of flare gas by signing agreements with flare gas buyers, processing business permit holders, or natural gas trading permit holders, which will use flare gas in commercial applications such as power generation fuels (e.g., compressed or liquified natural gas) (Article 2). Contractors must submit an application for flare gas utilization to SKK Migas or BPMA. The application must include documents on the flare gas source and the corresponding contracted volumes, the delivery point, contract duration, flare gas buyer and infrastructure descriptions, and a copy of the price agreement. Based on an evaluation of the bid parameters, SKK Migas or BPMA will make recommendations to the ESDM, which (through DG Migas) will approve or reject the application.