Regulation of the Total Energy Program for 2009

The Coordination and Management Undersecretary’s Office, from the Ministry of Federal Planning, Public Investment and Services, issued Regulation No 287/2008, which approved the General Regulation of the Total Energy Program for 2009 (the “Regulation”).

This Regulation was published in the Official Gazette on February 23, 2009, and it sets forth the general guidelines for the implementation of the Total Energy Program (“TEP”) for 2009.

The aims of the TEP are: to guarantee the energy resources’ supply, derived from both gas and oil, and to encourage the use of alternative fuels in the productive activities and the generation of electricity consumed by its owner (please see “Extension of the Total Energy Program”, in Marval News #71 of April 30, 2008).

The Regulation identifies and defines the powers and duties of the several subjects of the TEP, which are, among others: (i) the Beneficiaries (fuels and/or electricity consumers); (ii) Executive, Technical-Operative Management, Monitoring and Control, and Monitoring and Management Units; (iii) Advisors; and (iv) Authority of Application.

The resources to accomplish TEP’s aims are foreseen in the Regulation. On the one hand, part of those resources shall come from the funds of the National Treasury collected from gaseous and liquid fuels exportation rights. On the other hand, the Regulation specifies the subjects and resources of the trust fund that must be created, pursuant Decree 2067/2008, in order to fulfill the execution of the TEP.

There are two plans implemented by means of this Regulation:

a.    the General Plan for Gaseous Fuels Supply, that includes:

(i)            Liquefied Natural Gas (LNG) Supply Plan, whose objective is the construction, maintenance, management and administration of a system for the re-gasification of LNG (through a re-gasification ship) in order to provide the Argentine market with this fluid;

(ii)           Propane-Air Supply Plan, aimed at managing and administrating a system to acquire and deliver Propane-Air to be injected into the Province of Buenos Aires’ natural gas medium pressure distribution network; and

(iii)          Foreign Produced Gas Supply Plan, which encourages the execution of all the necessary tasks to provide the local market with foreign produced gas, in order to accomplish TEP’s aims.

b.    the General Plan for Liquid Fuel Supply, that comprises:

(i)            Supply on Demand Plan to ensure the supply of liquid fuels derived from oil to meet general demand, according to the economic growth and industrial development; and

(ii)           Replacement of Gas and/or Electricity Consumption by Alternative Fuels Plan, whose purpose is to encourage the replacement of gas and electricity for the use of alternative fuels for the productive activities and the generation of electricity to be consumed by its producer.