On October 26, 2021, the Legislative Assembly of El Salvador approved Legislative Decree No. 190, which contains the law on the establishment of the General Directorate of Energy, Hydrocarbons and Mines; the said decree was published in the Official Journal number 212, volume 433, dated November 8, 2021, and its validity will begin one year after its publication.
The purpose of this law is to create the General Directorate of Energy, Hydrocarbons and Mines, establishing that this Directorate will have all the attributions in matters falling under this law, so that when the National Energy Council , the General Directorate of Hydrocarbons and Mines and the Ministry of the Economy are mentioned in the legal provisions with regard to this law, it will be understood that these functions will be exercised by this new Directorate.
The purpose of the Directorate is the formulation, adoption, monitoring, evaluation of compliance with policies, strategies, plans and regulations of the energy, hydrocarbon and mining sectors, as well as to authorize, regulate and overseeing the functioning of those involved in these activities, specifying that oversight includes monitoring, control, evaluation, inspection and control, which may require compliance with applicable policies, strategies, plans, laws and regulations as well as impose sanctions.
This Directorate will have the power to represent the Executive Power as the supreme entity in energy matters. On this point, it is relevant to specify that the law mentions that all the powers, competences, powers, attributions and duties which were attributed to the current National Energy Council will be transferred to the Directorate; as well as in the field of hydrocarbons and mines, where the powers, competences, powers, attributions and duties of the Department of Hydrocarbons and Mines and of the Ministry of the Economy with regard to the energy sector, Hydrocarbons and Mines, will be transferred to the Directorate.
The law establishes specific powers of the Directorate with regard to each sector, that is to say for the energy sector, the hydrocarbons sector and the mining sector, emphasizing that in each of these sectors, management will be responsible for developing, formulating or approving policies for each sector.
Within the energy sector, the Directorate will oversee policies, regulations and strategies and ensure that sector participants’ plans comply with them, among other authorities. In the hydrocarbons sector, the Directorate will be the entity responsible for handling the exploration and exploitation concessions of hydrocarbons proposed by the CEL, after approval by the Legislative Assembly; it will also regulate and control the import and export, as well as the deposit, transport, distribution and marketing of petroleum products, the construction and operation of warehouses and reservoirs for private consumption, gas stations. service, liquefied petroleum gas conditioning plants and other activities as established by law regulating the deposit, transportation and distribution of petroleum products. In addition, with regard to the law on natural gas, the Directorate will have the power to regulate the reception, storage, regasification, transport, distribution and marketing of natural gas.
Regarding the requests, administrative and judicial procedures and administrative appeals which were pending at the entry into force of this law, it is established that these will be dealt with by this Directorate.