Are you looking for the latest news on gas negotiations in the DRC? You are in the right place ! In this article, we will look at the blocking of negotiations for the exploitation of 3 gas blocks on Lake Kivu.
According to Lewis Yola, an expert in downstream oil and in the negotiation of oil contracts and member of the Congo N’est Pas à Vendre (CNPAV) coalition, the implicit silence of the hydrocarbons code on the tax regime specific to gas would be an obstacle in these negotiations. . He emphasizes that the timing of the negotiations is regulated, but so far, nothing has evolved.
To better understand the situation, let’s look at the facts. On January 13, 2023, the Ministry of Hydrocarbons made public the list of the three companies selected for the exploitation of the gas blocks of Lake Kivu: Symbion Power & Red, Alfajiri Energy Corporation and Winds exploration and production LLC. Orders establishing the negotiating commission for these blocks were signed on February 13, 2023.
However, the negotiations did not progress as planned. According to Lewis Yola, the absence of a specific tax framework for gas in Congolese legislation is a major sticking point. In fact, the State wants to apply the oil tax regime to gas, which the companies do not accept. This issue should be debated in the council of ministers to reach a compromise.
Another hypothesis put forward by the expert is the financial and technical incapacity of certain selected companies, which could also hamper the negotiation process. According to him, one of the selected companies, ALFAJIRI, would have difficulty mobilizing the necessary funds.
Faced with these obstacles, Lewis Yola calls on the President of the Republic, Félix Tshisekedi, to get involved and reassess the case of ALFAJIRI, whom he considers unable to respect the binding conditions for the exploitation of the Lwandjofu block.
In financial terms, the DRC could suffer losses estimated at more than a billion dollars if the opacity surrounding the allocation and negotiations of oil and gas blocks is not lifted.
It is to be hoped that these obstacles will be overcome and that negotiations can resume in the interest of the DRC and its gas potential. The exploitation of these resources could contribute to the economic development of the country and bring long-term benefits to the Congolese population