ANNOUNCEMENT 31 Oct 2014In October 2014, the government of Argentina announced changed rules for foreign investors.
NUMBER OF INTERVENTIONS
Federal Register of Argentina (2014)"El Senado y C?mara de Diputados de la Naci?n Argentina reunidos en Congreso, etc. sancionan con fuerza de Ley: T?tulo I Modificaciones a la ley 17.319". Available from:http://www.infoleg.gob.ar/infolegInternet/anexos/235000-239999/237401/norma.htm
On the 31 October 2014, the government of the Republic of Argentina approved a New Hydrocarbon Law. The novelties shall provide incentives for long-term foreign investment in the national oil and gas sector.
National Bidding Process & Duration of Exploration Period
The old regionally fragmented bidding process was replaced by a single national tender process that applies to all oil-producing regions.
The previous ceiling of 5 exploration permits per company has been removed.
The new law extends exploitationperiods. Nevertheless, the length of extension is dependent on the type of resources: 35 years for unconventional resources; 30 years for offshore resources; and 25 years for onshore conventional resources. Concessionaires may further request multiple extensions up to a maximum period of 10 years.
The new investment act allows concessionaires that invest more than $250 million over three years to sell specific portions of their production on international markets free from export taxes. Specifically, concessionaries shall be allowed to sell the following percentages of their production free of export taxes:
The New Hydrocarbon Law also introduces a uniform tax structure for production activities at national, provincial and municipal levels. Going forward, provincial governments may no longer impose new taxes or alter existing tax rates that affect new investments.
The individual provincial government royalties were unified to a national rate of 12%. They may only be increased by up to 3% on each concession extension.
Furthermore, the federal government and the regional provinces are prohibited from awarding newly-created reserve areas to companies under their control.